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51Talk Online Education Group

51Talk Online Education GroupCOE決算レポート

NYSE

51Talk Online Education Group is a leading online English education service provider headquartered in China, primarily catering to K-12 students and adult learners across the domestic market. It offers live one-on-one and small-group tutoring sessions taught by certified native English-speaking instructors, with tailored courses covering conversational English, exam preparation and academic English to meet diverse learning demands.

What changed in 51Talk Online Education Group's 20-F — 2024 vs 2025

Top changes in 51Talk Online Education Group's 2025 20-F

513 paragraphs added · 696 removed · 396 edited across 6 sections

Item 2. Properties

Properties — owned and leased real estate

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ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE 4 ITEM 3. KEY INFORMATION 4 ITEM 4. INFORMATION ON THE COMPANY 50 ITEM 4.A. UNRESOLVED STAFF COMMENTS 81 ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS 81 ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES 95 ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS 106 ITEM 8. FINANCIAL INFORMATION 107 ITEM 9.
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE 4 ITEM 3. KEY INFORMATION 4 ITEM 4. INFORMATION ON THE COMPANY 38 ITEM 4.A. UNRESOLVED STAFF COMMENTS 68 ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS 68 ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES 78 ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS 88 ITEM 8. FINANCIAL INFORMATION 89 ITEM 9.
THE OFFER AND LISTING 107 ITEM 10. ADDITIONAL INFORMATION 108 ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 125 ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES 126 PART II . ​ 128
THE OFFER AND LISTING 90 ITEM 10. ADDITIONAL INFORMATION 90 ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 106 ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES 107 PART II . ​ 109

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Our operations and investments in Asia are subject to various risks related to the economic, political and social conditions of the countries and regions that we operate in, including risks related to the following: ● inconsistent and evolving regulations, licensing and legal requirements may increase our operational risks and cost of operations among the countries and regions in Asia in which we operate; ● currencies may be devalued or may depreciate or currency restrictions or other restraints on transfer of funds may be imposed; ● the effects of inflation within Asia generally and/or within any specific country in which we operate may increase our cost of operations; ● governments or regulators may impose new or more burdensome regulations, taxes or tariffs; ● political changes may lead to changes in the business, legal and regulatory environments in which we operate; ● economic downturns, political instability, civil disturbances, war, military conflict, religious or ethnic strife, terrorism and general security concerns may negatively affect our operations; ● enactment or any increase in the enforcement of regulations, including, but not limited to, those related to personal data protection and localization and cybersecurity, and especially on the cross-border acquisition and use of personal data by our company, may incur compliance costs; ● health epidemics, pandemics or disease outbreaks may affect our operations and demand for our offerings; and ● natural disasters like volcanic eruptions, floods, typhoons and earthquakes may impact our operations severely.
Our operations and investments in Asia are subject to various risks related to the economic, political and social conditions of the countries and regions that we operate in, including risks related to the following: ● inconsistent and evolving regulations, licensing and legal requirements may increase our operational risks and cost of operations among the countries and regions in Asia and EMEA in which we operate; ● currencies may be devalued or may depreciate or currency restrictions or other restraints on transfer of funds may be imposed; ● the effects of inflation within Asia and EMEA generally and/or within any specific country in which we operate may increase our cost of operations; ● governments or regulators may impose new or more burdensome regulations, taxes or tariffs; ● political changes may lead to changes in the business, legal and regulatory environments in which we operate; ● economic downturns, political instability, civil disturbances, war, military conflict, religious or ethnic strife, terrorism and general security concerns may negatively affect our operations; ● enactment or any increase in the enforcement of regulations, including, but not limited to, those related to personal data protection and localization and cybersecurity, and especially on the cross-border acquisition and use of personal data by our company, may incur compliance costs; ● health epidemics, pandemics or disease outbreaks may affect our operations and demand for our offerings; and ● natural disasters like volcanic eruptions, floods, typhoons and earthquakes may impact our operations severely.
The market price and trading volume for our ADSs may be volatile and subject to wide fluctuations in response to factors including, but not limited to, the following: ● the financial projections that we may choose to provide to the public, any changes in those projections or our failure for any reason to meet those projections; ● variations in our net revenues, net loss/income and cash flow; ● changes in the economic performance or market valuation of other education companies; ● announcements of new investments, acquisitions by us or our competitors, strategic partnerships, joint ventures or capital commitments; ● announcements of new services and expansions by us or our competitors; ● detrimental negative publicity about us, our competitors or our industry; ● changes in financial estimates by securities analysts; 44 Table of Contents ● additions or departures of key personnel; ● release of lock-up or other transfer restrictions on our outstanding equity securities or sales of additional equity securities; ● potential litigation or regulatory investigations and other actions; ● substantial sales or perception of sales of our ADSs in the public market; ● fluctuations in market prices for our products; ● any share repurchase program; ● outbreaks of health epidemics, natural disasters, and other extraordinary events; and ● general economic, regulatory or political conditions in the international markets in which we operate and mainland China.
The market price and trading volume for our ADSs may be volatile and subject to wide fluctuations in response to factors including, but not limited to, the following: ● the financial projections that we may choose to provide to the public, any changes in those projections or our failure for any reason to meet those projections; ● variations in our net revenues, net loss/income and cash flow; ● changes in the economic performance or market valuation of other education companies; ● announcements of new investments, acquisitions by us or our competitors, strategic partnerships, joint ventures or capital commitments; ● announcements of new services and expansions by us or our competitors; ● detrimental negative publicity about us, our competitors or our industry; ● changes in financial estimates by securities analysts; ● additions or departures of key personnel; ● release of lock-up or other transfer restrictions on our outstanding equity securities or sales of additional equity securities; ● potential litigation or regulatory investigations and other actions; 32 Table of Contents ● substantial sales or perception of sales of our ADSs in the public market; ● fluctuations in market prices for our products; ● any share repurchase program; ● outbreaks of health epidemics, natural disasters, and other extraordinary events; and ● general economic, regulatory or political conditions in the international markets in which we operate and mainland China.
In addition, if the businesses we acquire or invest in do not subsequently generate the anticipated financial performance or if any goodwill impairment test triggering event occurs, we may need to revalue or write down the value of goodwill and other intangible assets in connection with such acquisitions or investments, which would harm our results of operations.
If the businesses we acquire or invest in do not subsequently generate the anticipated financial performance or if any goodwill impairment test triggering event occurs, we may need to revalue or write down the value of goodwill and other intangible assets in connection with such acquisitions or investments, which would harm our results of operations.
In particular, we face a number of challenges relating to data from transactions and other activities on our platforms, including: ● protecting the data in and hosted on our system, including against attacks on our system by outside parties or fraudulent behavior or improper use by our employees; ● addressing concerns related to privacy and sharing, safety, security and other factors; and ● complying with applicable laws, rules and regulations relating to the collection, use, storage, transfer, disclosure and security of personal information, including any requests from regulatory and government authorities relating to these data. ​ 20 Table of Contents As all of our servers and routers, including backup servers, are currently hosted by third-party service providers in Singapore, we are, with regards to privacy legislation, subject principally to the Singapore Personal Data Protection Act 2012 which provides a baseline standard for the protection of personal data in Singapore.
In particular, we face a number of challenges relating to data from transactions and other activities on our platforms, including: ● protecting the data in and hosted on our system, including against attacks on our system by outside parties or fraudulent behavior or improper use by our employees; ● addressing concerns related to privacy and sharing, safety, security and other factors; and ● complying with applicable laws, rules and regulations relating to the collection, use, storage, transfer, disclosure and security of personal information, including any requests from regulatory and government authorities relating to these data. ​ 12 Table of Contents As all of our servers and routers, including backup servers, are currently hosted by third-party service providers in Singapore, we are, with regards to privacy legislation, subject principally to the Singapore Personal Data Protection Act 2012 which provides a baseline standard for the protection of personal data in Singapore.
We charge customers fees in local currencies in some countries and regions where we offer our course offerings, a significant portion of our assets and liabilities are denominated in US dollars and Renminbi, and a significant portion of our costs are incurred in the currencies of the countries and regions where we operate, including service fee payments to nearly all of our foreign tutors.
We charge customers fees in local currencies in some countries and regions where we offer our course offerings, a significant portion of our assets and liabilities are denominated in US dollars and Renminbi, and a significant portion of our costs and expenses are incurred in the currencies of the countries and regions where we operate, including service fee payments to nearly all of our foreign tutors.
If we incur any loss that is not covered by our insurance policies, or the compensated amount is significantly less than our actual loss, our business, financial condition and results of operations could be materially and adversely affected. 31 Table of Contents If we fail to implement and maintain an effective system of internal controls to remediate our material weaknesses over financial reporting, we may be unable to accurately report our results of operations, meet our reporting obligations or prevent fraud, and investor confidence and the market price of our ADSs may be materially and adversely affected.
If we incur any loss that is not covered by our insurance policies, or the compensated amount is significantly less than our actual loss, our business, financial condition and results of operations could be materially and adversely affected. 22 Table of Contents If we fail to implement and maintain an effective system of internal controls to remediate our material weaknesses over financial reporting, we may be unable to accurately report our results of operations, meet our reporting obligations or prevent fraud, and investor confidence and the market price of our ADSs may be materially and adversely affected.
If we are subject to severe penalties or incur significant liabilities in connection with labor disputes or investigations, our business and results of operations may be adversely affected. 38 Table of Contents PRC regulations relating to foreign exchange registration of international investment by mainland China residents may subject our mainland China resident beneficial owners or our mainland China subsidiaries to liability or penalties, limit our ability to inject capital into these subsidiaries, limit mainland China subsidiaries’ ability to increase their registered capital or distribute profits to us, or may otherwise adversely affect us.
If we are subject to severe penalties or incur significant liabilities in connection with labor disputes or investigations, our business and results of operations may be adversely affected in China. 30 Table of Contents PRC regulations relating to foreign exchange registration of international investment by mainland China residents may subject our mainland China resident beneficial owners or our mainland China subsidiaries to liability or penalties, limit our ability to inject capital into these subsidiaries, limit mainland China subsidiaries’ ability to increase their registered capital or distribute profits to us, or may otherwise adversely affect us.
We derive revenues from our business conducted through our offshore subsidiaries. However, there is no assurance that we would not need dividends and other distributions on equity from our mainland China subsidiaries to satisfy our liquidity requirements.
We derive revenues from our business conducted through our subsidiaries. However, there is no assurance that we would not need dividends and other distributions on equity from our mainland China subsidiaries to satisfy our liquidity requirements.
Our reputation may be negatively affected as a result of the public dissemination of negative, inaccurate, or misleading information about our business and operations, which in turn may cause us to lose market share or students, and adversely affect the price of our ADSs. 28 Table of Contents We may not be able to achieve the benefits we expect from recent and future acquisitions, and recent and future acquisitions may have an adverse effect on our ability to manage our business.
Our reputation may be negatively affected as a result of the public dissemination of negative, inaccurate, or misleading information about our business and operations, which in turn may cause us to lose market share or students, and adversely affect the price of our ADSs. 19 Table of Contents We may not be able to achieve the benefits we expect from recent and future acquisitions, and recent and future acquisitions may have an adverse effect on our ability to manage our business.
Even if you are successful in bringing an action of this kind, the laws of the Cayman Islands and of mainland China may render you unable to enforce a judgment against our assets or the assets of our directors and officers. ​ 47 Table of Contents The voting rights of holders of ADSs are limited by the terms of the deposit agreement, and you may not be able to exercise your right to vote your Class A ordinary shares.
Even if you are successful in bringing an action of this kind, the laws of the Cayman Islands and of mainland China may render you unable to enforce a judgment against our assets or the assets of our directors and officers. 35 Table of Contents The voting rights of holders of ADSs are limited by the terms of the deposit agreement, and you may not be able to exercise your right to vote your Class A ordinary shares.
We may not succeed in executing these growth strategies due to a number of factors, including the following: ● we may fail to develop or implement our new business models and service offerings; ● we may fail to further promote our platforms; ● we may not be able to engage, train and retain a sufficient number of qualified tutors and other key personnel; ● we may not be able to continue to improve our personalized learning experience of our students or to develop new courses that meet the changing demands for English learners; ● our business may face additional regulatory challenges; ​ 19 Table of Contents ● we may fail to grow our international business; ● we may fail to maintain the technology necessary to deliver a smooth learning experience to our students; and ● we may not be able to identify suitable targets for acquisitions and partnership.
We may not succeed in executing these growth strategies due to a number of factors, including the following: ● we may fail to develop or implement our new business models and service offerings; ● we may fail to further promote our platforms; ● we may not be able to engage, train and retain a sufficient number of qualified tutors and other key personnel; ● we may not be able to continue to improve our personalized learning experience of our students or to develop new courses that meet the changing demands for English learners; ● our business may face additional regulatory challenges; ● we may fail to grow our international business; ● we may fail to maintain the technology necessary to deliver a smooth learning experience to our students; and ● we may not be able to identify suitable targets for acquisitions and partnership.
We derive a significant portion of our revenue from our operations in countries and regions located in Asia, and we intend to continue to develop and expand our business and penetration in these countries and regions.
We derive a significant portion of our revenue from our operations in countries and regions located in Asia and EMEA, and we intend to continue to develop and expand our business and penetration in these countries and regions.
If any of the third-party online payment platforms breaches the contracts and fails to transfer any payments to us, it may have a material adverse effect on our business and financial condition. 29 Table of Contents If our senior management is unable to work together effectively or efficiently or if we lose their services, our business may be severely disrupted.
If any of the third-party online payment platforms breaches the contracts and fails to transfer any payments to us, it may have a material adverse effect on our business and financial condition. 20 Table of Contents If our senior management is unable to work together effectively or efficiently or if we lose their services, our business may be severely disrupted.
Although we do not believe that we were a PFIC for the taxable year ended December 31, 2024, no assurances can be given that we will not be a PFIC for the current or any future taxable year because the determination of whether we will be or become a PFIC is a factual determination made annually that will depend, in part, upon the characterization and composition of our income, assets and liabilities.
Although we do not believe that we were a PFIC for the taxable year ended December 31, 2025, no assurances can be given that we will not be a PFIC for the current or any future taxable year because the determination of whether we will be or become a PFIC is a factual determination made annually that will depend, in part, upon the characterization and composition of our income, assets and liabilities.
The depositary may refuse to deliver, transfer or register transfers of our ADSs generally when our share register or the books of the depositary are closed, or at any time if we or the depositary thinks it is advisable to do so because of any requirement of law or of any government or governmental body, or under any provision of the deposit agreement, or for any other reason. ​ 49 Table of Contents
The depositary may refuse to deliver, transfer or register transfers of our ADSs generally when our share register or the books of the depositary are closed, or at any time if we or the depositary thinks it is advisable to do so because of any requirement of law or of any government or governmental body, or under any provision of the deposit agreement, or for any other reason. ​ 37 Table of Contents
Failure to renew our current leases or locate desirable alternatives for our facilities could materially and adversely affect our business. We lease properties for our offices in mainland China, the Philippines, Malaysia, Hong Kong, Thailand and other countries and regions where we operate.
Failure to renew our current leases or locate desirable alternatives for our facilities could materially and adversely affect our business. We lease properties for our offices in Middle East, the Philippines, Malaysia, Hong Kong, Thailand, mainland China and other countries and regions where we operate.
Risk Factors—Risks Related to Our Business and Industry—If we fail to develop and introduce new courses that meet our existing and prospective students’ expectations, or adopt new technologies important to our business, our competitive position and ability to generate revenues may be materially and adversely affected.” ​ 14 Table of Contents ● Our business generates and processes a large amount of data, and we are required to comply with applicable laws relating to privacy and cybersecurity.
Risk Factors—Risks Related to Our Business and Industry—If we fail to develop and introduce new courses that meet our existing and prospective students’ expectations, or adopt new technologies important to our business, our competitive position and ability to generate revenues may be materially and adversely affected.” ● Our business generates and processes a large amount of data, and we are required to comply with applicable laws relating to privacy and cybersecurity.
Business Overview—Government Regulations—Singapore Regulations.” ​ 21 Table of Contents If we are unable to comply with the broadcasting and online content laws and regulations, we could become subject to penalties, including fines, revocation of our licenses, blocking and/or takedown of our online content.
Business Overview—Government Regulations—Singapore Regulations.” ​ 13 Table of Contents If we are unable to comply with the broadcasting and online content laws and regulations, we could become subject to penalties, including fines, revocation of our licenses, blocking and/or takedown of our online content.
Holders of our ADSs or ordinary shares to significant adverse U.S. federal income tax consequences.” 16 Table of Contents ● If securities or industry analysts do not publish research or reports about our business, or if they adversely change their recommendations regarding our ADSs, the market price for our ADSs and trading volume could decline. See “Item 3. Key Information—D.
Holders of our ADSs or ordinary shares to significant adverse U.S. federal income tax consequences.” ● If securities or industry analysts do not publish research or reports about our business, or if they adversely change their recommendations regarding our ADSs, the market price for our ADSs and trading volume could decline. See “Item 3. Key Information—D.
Sales of these registered shares in the public market, or the perception that such sales could occur, could cause the price of our ADSs to decline. ​ 46 Table of Contents You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we are incorporated under Cayman Islands law.
Sales of these registered shares in the public market, or the perception that such sales could occur, could cause the price of our ADSs to decline. You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we are incorporated under Cayman Islands law.
See “Item 3. Key Information—D. Risk Factors—Risks Related to Our Business and Industry—If we are unable to conduct sales and marketing activities cost-effectively, our results of operations and financial condition may be materially and adversely affected.” ● We have incurred, and in the future may continue to incur, net losses. See “Item 3. Key Information—D.
See “Item 3. Key Information—D. Risk Factors—Risks Related to Our Business and Industry—If we are unable to conduct sales and marketing activities cost-effectively, our results of operations and financial condition may be materially and adversely affected.” 6 Table of Contents ● We have incurred, and in the future may continue to incur, net losses. See “Item 3. Key Information—D.
(11) In January 2024, HAWO EDUCATION INVESTMENT -FZCO, or UAE INVESTMENT, was incorporated as a wholly owned subsidiary of HelloWorld Online Singapore in United Arab Emirates. (12) In February 2024, Hawo Online Training L.L.C-FZ, or UAE Training, was incorporated as a wholly owned subsidiary of HelloWorld Online Singapore in United Arab Emirates.
(12) In January 2024, HAWO EDUCATION INVESTMENT -FZCO, or UAE INVESTMENT, was incorporated as a wholly owned subsidiary of HelloWorld Online Singapore in United Arab Emirates. (13) In February 2024, Hawo Online Training L.L.C-FZ, or UAE Training, was incorporated as a wholly owned subsidiary of HelloWorld Online Singapore in United Arab Emirates.
As a result, fluctuations in exchange rates may increase our expenses and have a material adverse effect on our results of operations. 30 Table of Contents Our results of operations have been and may continue to be subject to seasonal fluctuations.
As a result, fluctuations in exchange rates may increase our expenses and have a material adverse effect on our results of operations. 21 Table of Contents Our results of operations have been and may continue to be subject to seasonal fluctuations.
Because we do not have full control over how and what our independently contracted tutors and students will use our platform to communicate, our platforms may from time to time be misused by individuals or groups of individuals to engage in immoral, disrespectful, fraudulent or illegal activities.
Our platforms allow independently contracted tutors and students to engage in real-time communication. Because we do not have full control over how and what our independently contracted tutors and students will use our platform to communicate, our platforms may from time to time be misused by individuals or groups of individuals to engage in immoral, disrespectful, fraudulent or illegal activities.
Because we qualify as a foreign private issuer under the Exchange Act, we are exempt from certain provisions of the securities rules and regulations in the United States that are applicable to U.S. domestic issuers, including: ● the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q or current reports on Form 8-K; ● the sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations in respect of a security registered under the Exchange Act; ● the sections of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and liability for insiders who profit from trades made in a short period of time; ● the selective disclosure rules by issuers of material nonpublic information under Regulation FD; and ● certain audit committee independent requirements in Rule 10A-3 of the Exchange Act.
Because we qualify as a foreign private issuer under the Exchange Act, we are exempt from certain provisions of the securities rules and regulations in the United States that are applicable to U.S. domestic issuers, including: ● the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q or current reports on Form 8-K; ● the sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations in respect of a security registered under the Exchange Act; ● the sections of the Exchange Act requiring the liability for insiders who profit from trades made in a short period of time; ● the selective disclosure rules by issuers of material nonpublic information under Regulation FD; and ● certain audit committee independent requirements in Rule 10A-3 of the Exchange Act.
We incurred net loss from continuing operations for 2022, 2023 and 2024. We cannot assure you that we will be able to generate net profits or positive cash flow from operating activities in the future, especially as we divested the China Mainland Business and transitioned into new international markets, the financial prospects of which are largely uncertain.
We incurred net loss for 2023, 2024 and 2025. We cannot assure you that we will be able to generate net profits or positive cash flow from operating activities in the future, especially as we divested the China Mainland Business and transitioned into new international markets, the financial prospects of which are largely uncertain.
It could also adversely affect the financial and economic conditions in the jurisdictions in which we operate, as well as our international expansion, our financial condition, and results of operations.
It could also adversely affect the financial and economic conditions in the jurisdictions in which we operate, as well as our global expansion, our financial condition, and results of operations.
Based on the foregoing, as advised by our PRC legal counsel, Shihui Partners, our mainland China subsidiaries are not required by the CAC to go through cybersecurity review in connection with our operations or our company’s issuance of securities to foreign investors.
Based on the foregoing, as advised by our PRC legal counsel, Shihui Partners, our mainland China subsidiaries are not required by the CAC to go through cybersecurity review in connection with our company’s previous issuance of securities to foreign investors.
It is difficult to predict how market forces or government policy may impact the exchange rate among the currencies of the countries and regions where we operate and the U.S. dollar in the future. Very limited hedging options are available in certain jurisdictions where we operate, such as mainland China, to reduce our exposure to exchange rate fluctuations.
It is difficult to predict how market forces or government policy may impact the exchange rate among the currencies of the countries and regions where we operate and the U.S. dollar in the future. Very limited hedging options are available in certain jurisdictions where we operate to reduce our exposure to exchange rate fluctuations.
For example, to the extent that we need to convert U.S. dollars into Renminbi for capital expenditures and working capital, appreciation of the Renminbi against the U.S. dollar would have an adverse effect on the Renminbi amount we would receive from the conversion.
For example, to the extent that we need to convert U.S. dollars into local currencies for capital expenditures and working capital, appreciation of the local currencies against the U.S. dollar would have an adverse effect on the local currencies amount we would receive from the conversion.
Taxation—United States Federal Income Taxation—Passive Foreign Investment Company Rules.” If securities or industry analysts do not publish research or reports about our business, or if they adversely change their recommendations regarding our ADSs, the market price for our ADSs and trading volume could decline.
Taxation—United States Federal Income Taxation—Passive Foreign Investment Company Rules.” 33 Table of Contents If securities or industry analysts do not publish research or reports about our business, or if they adversely change their recommendations regarding our ADSs, the market price for our ADSs and trading volume could decline.
As a result of these laws and regulations designed to enhance labor protection, we expect our labor costs will continue to increase. In addition, as the interpretation and implementation of these laws and regulations are still evolving, our employment practice may not at all times be deemed in compliance with the new laws and regulations.
As the laws and regulations in the PRC are designed to enhance labor protection, we expect our labor costs will continue to increase. In addition, as the interpretation and implementation of these laws and regulations are still evolving, our employment in China practice may not at all times be deemed in compliance with the new laws and regulations.
Press releases relating to financial results and material events are also be furnished to the SEC on Form 6-K. However, the information we are required to file with or furnish to the SEC are less extensive and less timely as compared to that required to be filed with the SEC by United States domestic issuers.
Press releases relating to financial results and material events are also furnished to the SEC on Form 6-K. However, the information we are required to file with or furnish to the SEC is less extensive and less timely than that required to be filed with the SEC by United States domestic issuers.
Enforcement of judgments in certain countries and regions where we operate, such as mainland China, is uncertain, and even if we are successful in litigation and purchase insurance in advance to cover costs arising from litigation, these may not provide us with an effective and adequate remedy.
Enforcement of judgments in certain countries and regions where we operate is uncertain, and even if we are successful in litigation and purchase insurance in advance to cover costs arising from litigation, these may not provide us with an effective and adequate remedy.
(8) In November 2022, Helloworld Education Online (Thailand) Co., Ltd., or Helloworld Education Thailand, was incorporated as a subsidiary of our company to operate our business in Thailand. Helloworld Online Singapore, Ms. Piyanuch Thiensri and Ms. Chularak Aramruansakul hold 49%, 26% and 25% of the equity interest in Helloworld Education Thailand, respectively.
(8) In November 2022, Helloworld Education Online (Thailand) Co., Ltd., or Helloworld Education Thailand, was incorporated as a subsidiary of our company to operate our business in Thailand. HelloWorld Online Singapore, Ms. Piyanuch Thiensri and Ms. Chulaluk Aramruangsakul hold 49%, 26% and 25% of the equity interest in Helloworld Education Thailand, respectively.
If we fail to successfully execute our growth strategies, our business and prospects may be materially and adversely affected. We are in the process of developing new business models and service offerings outside of mainland China. See “Item 4. Information on the Company” for details.
If we fail to successfully execute our growth strategies, our business and prospects may be materially and adversely affected. We are in the process of developing new business models and service offerings internationally. See “Item 4. Information on the Company” for details.
While detailed interpretation of or implementation rules under Article 177 have yet to be promulgated, the inability for an international securities regulator to directly conduct investigation or evidence collection activities within mainland China may further increase difficulties faced by you in protecting your interests. 32 Table of Contents Risks Related to Our Global Operations We are subject to risks associated with operating in the rapidly evolving Asia, and we are therefore exposed to various risks inherent in operating and investing in the region.
While detailed interpretation of or implementation rules under Article 177 have yet to be promulgated, the inability for an international securities regulator to directly conduct investigation or evidence collection activities within mainland China may further increase difficulties faced by you in protecting your interests. ​ 23 Table of Contents We are subject to risks associated with operating in the rapidly evolving Asia and EMEA, and we are therefore exposed to various risks inherent in operating and investing in the region.
In addition, our mainland China subsidiaries are required to set aside at least 10% of their respective accumulated profits each year, if any, to fund certain reserve funds until the total amount set aside reaches 50% of their respective registered capital.
In addition, our mainland China subsidiaries are required to set aside at least 10% of their respective accumulated after-tax profits each year, if any, to fund statutory reserve funds until the total amount set aside reaches 50% of their respective registered capital.
The M&A Rules discussed in the preceding paragraph and recently adopted regulations and rules concerning mergers and acquisitions established additional procedures and requirements that could make merger and acquisition activities by foreign investors more time consuming and complex.
The M&A Rules discussed in the preceding paragraph and other PRC regulations and rules concerning mergers and acquisitions established additional procedures and requirements that could make merger and acquisition activities by foreign investors more time consuming and complex.
According to the PRC Social Insurance Law, which became effective on July 1, 2011 and was amended on December 29, 2018, and the Administrative Regulations on the Housing Funds, Companies operating in mainland China are required to participate in pension insurance, work-related injury insurance, medical insurance, unemployment insurance, maternity insurance and housing funds plans, and the employers must pay all or a portion of the social insurance premiums and housing funds for their employees.
According to the PRC Social Insurance Law, which became effective on July 1, 2011 and was amended on December 29, 2018, and the Administrative Regulations on the Housing Funds, which became effective on April 3, 1999 and was last amended on March 24, 2019, companies operating in mainland China are required to participate in pension insurance, work-related injury insurance, medical insurance, unemployment insurance, maternity insurance and housing funds plans, and the employers must pay all or a portion of the social insurance premiums and housing funds for their employees.
Controls and Procedures.” However, we cannot assure you that we will be able to continually implement these measures to effectively remediate our material weaknesses, or that we will not identify additional material weaknesses or significant deficiencies in the future.
However, we cannot assure you that we will be able to continually implement these measures to effectively remediate our material weaknesses, or that we will not identify additional material weaknesses or significant deficiencies in the future.
In September 2006, the CSRC published a notice on its official website specifying documents and materials required to be submitted to it by a special purpose vehicle seeking CSRC approval of its overseas listings. The application of the M&A Rules remains unclear.
In September 2006, the CSRC published a notice on its official website specifying documents and materials required to be submitted to it by a special purpose vehicle seeking CSRC approval of its overseas listings.
For example, students may by-pass our geolocation settings to register for and attend our courses. There are no comprehensive methods to prevent students from mainland China to purchase and use our platform, and our ability to adopt technological safeguards are limited.
For example, students may by-pass our geolocation settings to register for and attend our courses. There are no comprehensive methods to prevent students in mainland China from purchasing and using our platform, and our ability to adopt technological safeguards are limited.
For example, rising trade and political tensions, including those arising from the conflict in Ukraine and sanctions on Russia and the conflict in the Gaza Strip, could reduce levels of trades, investments, technological exchanges and other economic activities between China and other countries, which would have an adverse effect on global economic conditions, the stability of global financial markets, and international trade policies.
For example, rising trade and political tensions, including those arising from the conflict in Ukraine and sanctions on Russia and the conflict in the Gaza Strip and the war among Iran and U.S. and Israel, among other geopolitical tensions, could reduce levels of trades, investments, technological exchanges and other economic activities among countries, which would have an adverse effect on global economic conditions, the stability of global financial markets, and international trade policies.
We do not maintain any liability insurance or property insurance policies covering students, equipment and facilities for injuries, death or losses due to fire, earthquake, flood or any other disaster, except for the liability insurance and property insurance policies for certain office in mainland China.
We do not maintain any liability insurance or property insurance policies covering students, equipment and facilities for injuries, death or losses due to fire, earthquake, flood or any other disaster, except for the liability insurance and property insurance policies for our certain offices.
Furthermore, as a Cayman Islands company listed on the NYSE American, we are permitted to elect to rely, and have relied, on the home country exemptions afforded to foreign private issuers under NYSE American Company Guide, including: ● an exemption from having a board of directors that is composed of a majority of independent directors; ● an exemption from having an audit committee comprised of at least three members; ​ 48 Table of Contents ● an exemption from having a compensation committee that is composed entirely of independent directors; ● an exemption from having a nominating and governance committee that is composed entirely of independent directors; and ● an exemption from holding an annual general meeting.
Furthermore, as a Cayman Islands company listed on the NYSE American, we are permitted to elect to rely, and have relied, on the home country exemptions afforded to foreign private issuers under NYSE American Company Guide, including: ● an exemption from having a board of directors that is composed of a majority of independent directors; ● an exemption from having an audit committee comprised of at least three members; ● an exemption from having a compensation committee that is composed entirely of independent directors; ● an exemption from having a nominating and governance committee that is composed entirely of independent directors; and 36 Table of Contents ● an exemption from obtaining shareholders’ approval for the adoption of the amended and restated 2016 share incentive plan ● an exemption from holding an annual general meeting.
DCM Funds, including DCM Hybrid RMB Fund, L.P., DCM Ventures China Turbo Fund, L.P. and DCM Ventures China Turbo Affiliates Fund, L.P., beneficially owned 19.4% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025, which represents 45.7% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025.
DCM Funds, including DCM Hybrid RMB Fund, L.P., DCM Ventures China Turbo Fund, L.P. and DCM Ventures China Turbo Affiliates Fund, L.P., beneficially owned 18.9% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026, which represents 45.4% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026.
The COVID-19 pandemic and the measures to contain its spread had from time to time resulted in business disruptions in the countries and regions where we operate. Our operations in countries and regions where we operate were affected by outbreaks of COVID-19 and precautions taken in response there. We engage independently contracted tutors and operate offices in the Philippines.
The COVID-19 pandemic and the measures to contain its spread had from time to time resulted in business disruptions in the countries and regions where we operate. For example, our operations in countries and regions where we operate were affected by outbreaks of COVID-19 and precautions taken in response there.
Some of our competitors may be able to devote more resources than we can to the development and promotion of their education programs and respond more quickly than we can to changes in student demands, market trends or new technologies.
In the future, we may also face competition from new entrants into the English education market. Some of our competitors may be able to devote more resources than we can to the development and promotion of their education programs and respond more quickly than we can to changes in student demands, market trends or new technologies.
Maintaining complete security for the storage and transmission of confidential information on our technology platform, such as student names, personal information and billing addresses, is essential to maintaining student confidence. We have adopted security policies and measures to protect our proprietary data and student information.
Maintaining complete security for the storage and transmission of confidential information on our technology platform, such as student names, phone numbers, and other personal information, is essential to maintaining student confidence. 17 Table of Contents We have adopted security policies and measures to protect our proprietary data and student information.
Furthermore, if our mainland China subsidiaries incur debt on their own behalf in the future, the instruments governing the debt may restrict their ability to pay dividends or make other payments to us.
Furthermore, if our mainland China subsidiaries incur debt on their own behalf in the future, the instruments governing the debt may restrict their ability to pay dividends or make other payments to us. Any limitation on the ability of our subsidiaries to distribute dividends to us may restrict our ability to satisfy our liquidity requirements.
As a result of grants under the 2013 Plan, the 2014 Plan and the 2016 Plan and potential future grants under the 2016 Plan, we have incurred and will continue to incur share-based compensation expenses. We have recognized share-based compensation expense in the amount of US$0.9 million in 2024.
As a result of grants under the 2013 Plan, the 2014 Plan and the Amended and Restated 2016 Plan and potential future grants under the Amended and Restated 2016 Plan, we have incurred and will continue to incur share-based compensation expenses. We have recognized share-based compensation expense in the amount of US$1.3 million in 2025.
We do not maintain business interruption insurance, nor do we maintain key-man life insurance We cannot assure you that our insurance coverage is sufficient to prevent us from any loss or that we will be able to successfully claim our losses under our current insurance policy on a timely basis, or at all.
We cannot assure you that our insurance coverage is sufficient to prevent us from any loss or that we will be able to successfully claim our losses under our current insurance policy on a timely basis, or at all.
We are also vulnerable to natural disasters and other calamities, including fire, floods, typhoons, earthquakes, power loss, telecommunications failures, break-ins, war, riots, terrorist attacks, and any other severe weather conditions or similar event may give rise to loss of personnel, damages to property, server interruptions, breakdowns, technology platform failures or internet failures, where our operations could be materially and adversely affected.
We are also vulnerable to natural disasters and other calamities, including fire, floods, typhoons, earthquakes, power loss, telecommunications failures, break-ins, war, riots, terrorist attacks, and any other severe weather conditions or similar event may give rise to loss of personnel, damages to property, server interruptions, breakdowns, technology platform failures or internet failures, where our operations could be materially and adversely affected. 18 Table of Contents Our brand image, business and results of operations may be adversely impacted by students and independently contracted tutors’ misconduct and misuse of our platform.
Golien Ltd beneficially owned 5.4% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025, which represents 1.5% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025.
Golien Ltd beneficially owned 5.3% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026, which represents 1.5% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026.
Mergers, acquisitions or contractual arrangements that allow one market player to take control of or to exert decisive impact on another market player must also be notified in advance to the Ministry of Commerce when the threshold under the Provisions on Thresholds for Prior Notification of Concentrations of Undertakings issued by the State Council in August 2008 is triggered.
Mergers, acquisitions or contractual arrangements that allow one market player to take control of or to exert decisive impact on another market player must also be notified in advance to the State Administration of Market Regulation when the threshold under the Provisions on Thresholds for Prior Notification of Concentrations of Undertakings last amended by the State Council of the PRC in January 2024 is triggered.
Third parties may in the future pirate our course materials and may infringe upon or misappropriate our other intellectual property. Infringement upon or the misappropriation of, our proprietary technologies or other intellectual property could have a material adverse effect on our business, financial condition or operating results. Policing the unauthorized use of proprietary technology can be difficult and expensive.
Infringement upon or the misappropriation of, our proprietary technologies or other intellectual property could have a material adverse effect on our business, financial condition or operating results. Policing the unauthorized use of proprietary technology can be difficult and expensive.
Negative publicity or consumer backlash can make it more difficult for us to attract new customers or retain existing ones, as trust and credibility are important factors for students and parents to consider when selecting educational services.
Negative publicity or consumer backlash arising from actual or perceived violations in any jurisdiction could make it more difficult for us to attract new customers or retain existing ones, as trust and credibility are important factors for students and parents to consider when selecting educational services.
We seek to engage highly qualified tutors with strong English and teaching skills. We must provide competitive pay and other benefits, such as flexibility in lesson scheduling to attract and retain them.
Our tutors are critical to the learning experience of our students and our reputation. We seek to engage highly qualified tutors with strong English and teaching skills. We must provide competitive pay and other benefits, such as flexibility in lesson scheduling to attract and retain them.
ITEM 3. KEY INFORMATION Our Holding Company Structure 51Talk Online Education Group is not an operating company but a Cayman Islands holding company. We conduct our business operations through our offshore subsidiaries, including our Hong Kong subsidiaries, as well as our subsidiaries in mainland China.
ITEM 3. KEY INFORMATION Our Holding Company Structure 51Talk Online Education Group is not an operating company but a Cayman Islands holding company. We conduct our business through our subsidiaries across different jurisdictions, including our Singapore subsidiary, Hong Kong subsidiaries, as well as our subsidiaries in other jurisdictions.
Shu and their family members, beneficially owned 24.6% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025, which represents 38.9% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025.
Shu and their family members, beneficially owned 24.5% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026, which represents 38.8% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026.
As of February 28, 2025, our Class B ordinary shares represent 29.5% of our total outstanding ordinary shares on an as-converted basis and entitle their holders to 80.7% of our total voting power.
As of March 18, 2026, our Class B ordinary shares represent 28.7% of our total outstanding ordinary shares on an as-converted basis and entitle their holders to 80.1% of our total voting power.
While internet penetration is increasing in Malaysia, there are still areas with limited access to devices such as computers and smartphones and with limited internet access, such as high-speed internet or technology infrastructure, which may impact the quality and reliability of our course offerings. The limited internet access and device access also affects the extent of digital literacy in Malaysia.
For example, in Malaysia, while internet penetration is increasing, there are still areas with limited access to devices (such as computers and smartphones) and limited internet access (including high-speed internet or supporting technology infrastructure), which may affect the quality and reliability of our course offerings.
We incurred net loss from continuing operations of US$12.8 million, US$15.0 million and US$7.3 million in 2022, 2023 and 2024, respectively. We had accumulated deficit of US$353.6 million as of December 31, 2024. As of December 31, 2024, we had a total shareholders’ equity of negative US$15.0 million and our current liabilities exceeded the current assets by US$16.8 million.
We incurred net loss of US$15.0 million, US$7.3 million and US$16.9 million in 2023, 2024 and 2025, respectively. We had accumulated deficit of US$370.4 million as of December 31, 2025. As of December 31, 2025, we had a total shareholders’ equity of negative US$31.3 million and our current liabilities exceeded the current assets by US$35.0 million.
If we are unable to continue to attract students to purchase our course packages or to increase the spending of our students on our platform, our net revenues and gross billings may decline, which may have a material adverse effect on our business, financial condition and results of operations. ​ 17 Table of Contents Our business depends on the market recognition of our brand, and if we are unable to maintain and enhance brand recognition, our business, financial conditions and results of operations may be materially and adversely affected.
If we are unable to continue to attract students to purchase our course packages or to increase the spending of our students on our platform, our net revenues and gross billings may decline, which may have a material adverse effect on our business, financial condition and results of operations.
In December 2015, we began outsourcing part of our marketing and sales functions to independent third- party suppliers who provide management and business outsourcing services. We had 852 sales and marketing staff for international business, including 360 full-time employees and 492 outsourced personnel as of December 31, 2024.
In December 2015, we began outsourcing part of our marketing and sales functions to independent third- party suppliers who provide management and business outsourcing services. We had 1,382 sales and marketing staff for international business, including 381 full-time employees (including free trial tutors and teaching support) and 1,001 outsourced personnel as of December 31, 2025.
For example, in mainland China, there are significant legal and other obstacles to providing information needed for regulatory investigations or litigation initiated outside mainland China.
For example, in mainland China, there may be obstacles to providing information needed for regulatory investigations or litigation initiated outside mainland China.
Huang and his family members, beneficially owned 5.9% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025, which represents 1.6 % of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025.
Huang and his family members, beneficially owned 8.5% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026, which represents 2.4% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026.
The anti-discrimination laws in Hong Kong require education companies to ensure that their educational content is accessible to all students, including those with disabilities. Failure to provide accessible content may be in violation of anti-discrimination laws and may result in legal action or reputational damage.
We are also subject to Hong Kong anti-discrimination laws, which require education companies to ensure that educational content is accessible to all students, including those with disabilities; failure to provide accessible content may result in legal action, regulatory scrutiny or reputational damage.
However, as the insurance industry in many countries and regions where we operate, including mainland China, is still in an early stage of development. For example, insurance companies in mainland China currently offer limited business-related insurance products. We also have limited experience dealing with the insurance industry in the Philippines.
However, as the insurance industry in many countries and regions where we operate is still in an early stage of development and service providers typically offer limited business-related insurance products. We also have limited experience dealing with the insurance industry in international markets.
Each of Noel Lee, Huiru Yuan, Jennifer Que, Arman James Manalang and Samuel Celestino is a director of Philippines Co II. We entered into contractual arrangements with some of these individual shareholders which provide us an exclusive option to purchase all of these individual shareholders’ equity interests in Philippines Co II and the power to exercise their shareholder rights.
We entered into contractual arrangements with some of these individual shareholders which provide us an exclusive option to purchase all of these individual shareholders’ equity interests in Philippines Co II and the power to exercise their shareholder rights.
Non-compliance with the laws and regulations regarding our operations in Hong Kong may materially and adversely affect our reputation, business operations and prospects.” ​ 5 Table of Contents The following diagram illustrates our current corporate structure, which includes our significant subsidiaries and consolidated affiliated entities as of the date of this annual report: Notes: ⁎ The holding company in which the investors hold their interests † Our operating subsidiaries (1) Jack Jiajia Huang and Ting Shu through their holding vehicles, which are wholly owned by TB Family Trust established for the benefits of Mr.
The following diagram illustrates our current corporate structure, which includes our significant subsidiaries as of the date of this annual report: ​ Notes: ⁎ The holding company in which the investors hold their interests † Our operating subsidiaries 4 Table of Contents (1) Jack Jiajia Huang and Ting Shu through their holding vehicles, which are wholly owned by TB Family Trust established for the benefits of Mr.
If a significant number of students fail to significantly improve their English proficiency after taking our lessons or if their learning experiences with us are unsatisfactory, they may not purchase additional lessons from us or refer other students to us and our business, financial condition, results of operations and reputation would be adversely affected.
If a significant number of students fail to significantly improve their English proficiency after taking our lessons or if their learning experiences with us are unsatisfactory, they may not purchase additional lessons from us or refer other students to us and our business, financial condition, results of operations and reputation would be adversely affected. 16 Table of Contents Our failure to protect our intellectual property rights may undermine our competitive position, and litigation to protect our intellectual property rights or defend against third party allegations of infringement may be costly and ineffective.
If it is determined in the future that approval and filing from the CSRC or other regulatory authorities or other procedures, are required for our offshore offerings or capital raising activities, it is uncertain whether we can or how long it will take us to obtain such approval or complete such filing procedures and any such approval or filing could be rescinded or rejected.
Moreover, according to the applicable rules and regulations, the determination of the overseas offerings and listings by domestic companies will be conducted on a “substance over form” basis. ​ 31 Table of Contents If it is determined in the future that approval and filing from the CSRC or other regulatory authorities or other procedures, are required for our offshore offerings or capital raising activities, it is uncertain whether we can or how long it will take us to obtain such approval or complete such filing procedures and any such approval or filing could be rescinded or rejected.
(9) In September 2018, Beijing HelloWorld Online Technology Co., Ltd., or HelloWorld Online, was incorporated as a wholly owned subsidiary of HelloWorld Online HK. (10) In March 2023, Darb Al-Najah Training Company, or Darb Al-Najah, was incorporated as a wholly owned subsidiary of HelloWorld Online Singapore to operate the international business in Saudi Arabia.
(10) In March 2023, Darb Al-Najah Training Company, or Darb Al-Najah, was incorporated as a wholly owned subsidiary of HelloWorld Online Singapore to operate the international business in Saudi Arabia. (11) In July 2023, HelloWorld Online Education Jordan LLC, or HelloWorld Jordan, was incorporated as a wholly owned subsidiary of our Company to operate the international business in Jordan.
If we fail to develop and introduce new courses that meet our existing and prospective students’ expectations, or adopt new technologies important to our business, our competitive position and ability to generate revenues may be materially and adversely affected.
If we fail to successfully execute our growth strategies, we may not be able to maintain our growth rate and our business and prospects may be materially and adversely affected as a result. 11 Table of Contents If we fail to develop and introduce new courses that meet our existing and prospective students’ expectations, or adopt new technologies important to our business, our competitive position and ability to generate revenues may be materially and adversely affected.
In addition, the PRC Enterprise Income Tax Law and its implementation rules provide that a withholding tax rate of up to 10% will be applicable to dividends payable by Chinese companies to non-PRC-resident enterprises unless otherwise exempted or reduced according to treaties or arrangements between the PRC central government and governments of other countries or regions where the non-PRC-resident enterprises are incorporated.
In addition, the PRC Enterprise Income Tax Law and its implementation rules provide that a withholding tax rate of up to 10% will be applicable to dividends payable by Chinese companies to non-PRC-resident enterprises unless otherwise exempted or reduced according to treaties or arrangements between the PRC central government and governments of other countries or regions where the non-PRC-resident enterprises are incorporated. ​ 29 Table of Contents The M&A Rules and certain other regulations of mainland China establish complex procedures for some acquisitions of Chinese companies by foreign investors, which could make it more difficult for us to pursue growth through acquisitions in mainland China.
We may encounter disputes from time to time over rights and obligations concerning intellectual property, and we may not prevail in those disputes. ​ 25 Table of Contents Any claims against us, with or without merit, could be time consuming and costly to defend or litigate, divert our management’s attention and resources or result in the loss of goodwill associated with our brand.
Any claims against us, with or without merit, could be time consuming and costly to defend or litigate, divert our management’s attention and resources or result in the loss of goodwill associated with our brand.
If we are unable to maintain our competitive position or otherwise respond to competitive pressure effectively, we may lose market share or be forced to reduce our fees for course packages, either of which would adversely impact our results of operations and financial condition.
If we are unable to maintain our competitive position or otherwise respond to competitive pressure effectively, we may lose market share or be forced to reduce our fees for course packages, either of which would adversely impact our results of operations and financial condition. ​ 10 Table of Contents If we are not able to continue to engage, train or retain qualified tutors, we may not be able to maintain consistent teaching quality on our platform, and our business, financial conditions and operating results may be materially and adversely affected.
Any uncertainties or negative publicity regarding such approval requirement could materially and adversely affect our business, prospects, financial condition, reputation, and the trading price of our listed securities.
Any uncertainties or negative publicity regarding such approval requirement could materially and adversely affect our business, prospects, financial condition, reputation, and the trading price of our listed securities. Risks Related to Our ADSs The trading prices of our ADSs have fluctuated and may be volatile, which could result in substantial losses to investors.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Our key business offering under our international business is one-on-one English lessons taught by English tutors to students in countries and regions outside of mainland China. We started our international business in the second half of 2021 and currently provide English course offerings in Hong Kong, Malaysia, Thailand, the Middle East and certain other countries and regions.
Our key business offering under our international business is one-on-one English lessons taught by English tutors to students in countries and regions outside of mainland China. We started our international business in the second half of 2021 and currently provide English course offerings in Hong Kong, Thailand, the Middle East and certain other countries and regions.
We do not maintain business interruption insurance, nor do we maintain key-man life insurance. We maintain personal accident insurance and supplementary medical insurance for all employees after six months of employment and management in mainland China, in addition to government-mandated medical insurance. For employees in Malaysia, Thailand and Saudi Arabia, we provide government-mandated medical and supplementary medical insurance.
We do not maintain business interruption insurance, nor do we maintain key-man life insurance. We maintain personal accident insurance and supplementary medical insurance for all employees after six months of employment and management in mainland China, in addition to government-mandated medical insurance. For employees in Malaysia, Thailand, Jordan and Saudi Arabia, we provide government-mandated medical and supplementary medical insurance.
In September 2022, to keep pace of our international business strategy, we changed the name of our offshore holding company from China Online Education Group to 51Talk Online Education Group, which was approved by way of special resolution at our annual general meeting.
In September 2022, to keep pace with our international business strategy, we changed the name of our offshore holding company from China Online Education Group to 51Talk Online Education Group, which was approved by way of special resolution at our annual general meeting.
The Archives Rules provide that, among other things, (i) in relation to the international offering and listing activities of domestic enterprises, the domestic enterprises are required to strictly comply with the requirements on confidentiality and archives management, establish a sound confidentiality and archives system, and take necessary measures to implement their confidentiality and archives management responsibilities; (ii) during the course of an international offering and listing, if a domestic enterprise needs to publicly disclose or provide to securities companies, accounting firms or other securities service providers and international regulators, any materials that contain relevant state secrets, work secrets of government agencies or that have a sensitive impact (i.e., be detrimental to national security or the public interest if divulged), the domestic enterprise should complete the approval/filing and other regulatory procedures; and (iii) working papers produced in mainland China by securities companies and securities service institutions, which provide domestic enterprises with securities services during their international issuance and listing, should be stored in mainland China, and the transmission of all such working papers to recipients outside of mainland China is required to be approved by competent authorities of mainland China. ​ 77 Table of Contents C.
The Archives Rules provide that, among other things, (i) in relation to the international offering and listing activities of domestic enterprises, the domestic enterprises are required to strictly comply with the requirements on confidentiality and archives management, establish a sound confidentiality and archives system, and take necessary measures to implement their confidentiality and archives management responsibilities; (ii) during the course of an international offering and listing, if a domestic enterprise needs to publicly disclose or provide to securities companies, accounting firms or other securities service providers and international regulators, any materials that contain relevant state secrets, work secrets of government agencies or that have a sensitive impact (i.e., be detrimental to national security or the public interest if divulged), the domestic enterprise should complete the approval/filing and other regulatory procedures; and (iii) working papers produced in mainland China by securities companies and securities service institutions, which provide domestic enterprises with securities services during their international issuance and listing, should be stored in mainland China, and the transmission of all such working papers to recipients outside of mainland China is required to be approved by competent authorities of mainland China.
(3) A “paying student” for a specified period refers to a student that purchased a course package during the period, excluding those students who only paid for live broadcasting lessons or trial lessons, and the total number of “paying students” for a specified period refers to the total number of paying students for such period minus the total number of students that obtained refunds during such period. ​ 53 Table of Contents Learning Process Our holistic learning process consists of four aspects: live lessons, effective practice, assessment and mentoring.
(3) A “paying student” for a specified period refers to a student that purchased a course package during the period, excluding those students who only paid for live broadcasting lessons or trial lessons, and the total number of “paying students” for a specified period refers to the total number of paying students for such period minus the total number of students that obtained refunds during such period. 40 Table of Contents Learning Process Our holistic learning process consists of four aspects: live lessons, effective practice, assessment and mentoring.
To ensure our tutors continue to improve, we offer standardized training modules based on their progress and experience level on our platform. Our tutors are ranked according to a six-star scale and most of them begin their careers as one-star tutors. In order to advance through our system, tutors must maintain high student ratings and complete the training modules.
To ensure our tutors continue to improve, we offer standardized training modules based on their progress and experience level on our platform. Our tutors are ranked according to a multi-star scale and most of them begin their careers as one-star tutors. In order to advance through our system, tutors must maintain high student ratings and complete the training modules.
In order to facilitate international capital raising of our company, we incorporated China Online Education Group, or 51Talk, to become our offshore holding company under the laws of the Cayman Islands in November 2012. In October 2014, 51 Talk English International Limited, or COE HK Co, was incorporated with limited liability in Hong Kong.
In order to facilitate international capital raising of our company, we incorporated China Online Education Group, or 51Talk, to become our offshore holding company under the laws of the Cayman Islands in November 2012. In October 2014, 51Talk English International Limited, or COE HK Co, was incorporated with limited liability in Hong Kong.
Thereafter, China Online Education (HK) Limited, or COE HK CO I, and its subsidiaries, and the VIEs, which our Cayman Islands holding company was considered the primary beneficiary of for accounting purposes and consolidated as required by Accounting Standards Codification topic 810, Consolidation, such as Dasheng Zhixing and its subsidiaries and branches, 51 Talk English Philippines Corporation, or Philippines Co I and Shenzhen Dasheng Zhiyun Technology Co., Ltd., or Dasheng Zhiyun, were all divested from us.
Thereafter, China Online Education (HK) Limited, or COE HK CO I, and its subsidiaries, and the VIEs, which our Cayman Islands holding company was considered the primary beneficiary of for accounting purposes and consolidated as required by Accounting Standards Codification topic 810, Consolidation, such as Dasheng Zhixing and its subsidiaries and branches, 51Talk English Philippines Corporation, or Philippines Co I and Shenzhen Dasheng Zhiyun Technology Co., Ltd., or Dasheng Zhiyun, were all divested from us.
Risk Factors—Risks Related to Our Business and Industry—Our results of operations have been and may continue to be subject to seasonal fluctuations.” ​ 60 Table of Contents Insurance We do not maintain any liability insurance or property insurance policies covering students, equipment and facilities for injuries, death or losses due to fire, earthquake, flood or any other disaster, except for the liability insurance and property insurance policies for certain office in mainland China.
Risk Factors—Risks Related to Our Business and Industry—Our results of operations have been and may continue to be subject to seasonal fluctuations.” Insurance We do not maintain any liability insurance or property insurance policies covering students, equipment and facilities for injuries, death or losses due to fire, earthquake, flood or any other disaster, except for the liability insurance and property insurance policies for certain office in mainland China.
On September 14, 2023, the President of Saudi Data & AI Authority (SDAIA) issued the Implementing Regulation of the Personal Data Protection Law and the Regulation on Personal Data Transfer Outside the Kingdom to supplement the implementation details and specific provisions of the Personal Data Protection Law. The Personal Data Protection Law regulates how personal data is processed digitally.
In September 2023, the President of Saudi Data & AI Authority (SDAIA) issued the Implementing Regulation of the Personal Data Protection Law and the Regulation on Personal Data Transfer Outside the Kingdom to supplement the implementation details and specific provisions of the Personal Data Protection Law. The Personal Data Protection Law regulates how personal data is processed digitally.
Organizational Structure The following diagram illustrates our current corporate structure, which includes our significant subsidiaries and consolidated affiliated entities as of the date of this annual report: ​ Notes: ⁎ The holding company in which the investors hold their interests + Our operating subsidiaries (1) Jack Jiajia Huang and Ting Shu through their holding vehicles, which are wholly owned by TB Family Trust established for the benefits of Mr.
Organizational Structure The following diagram illustrates our current corporate structure, which includes our significant subsidiaries as of the date of this annual report: ​ Notes: ⁎ The holding company in which the investors hold their interests † Our operating subsidiaries (1) Jack Jiajia Huang and Ting Shu through their holding vehicles, which are wholly owned by TB Family Trust established for the benefits of Mr.
The large pool of tutors not only allows us to accommodate and address students’ individual English proficiency level and learning behaviors and needs, but also ensures that we are able to afford students’ scheduling flexibility. ​ 52 Table of Contents We develop and tailor our proprietary curriculum specifically to our interactive lesson format and our goal of building an interactive and immersive English learning environment.
The large pool of tutors not only allows us to accommodate and address students’ individual English proficiency level and learning behaviors and needs, but also ensures that we are able to afford students’ scheduling flexibility. We develop and tailor our proprietary curriculum specifically to our interactive lesson format and our goal of building an interactive and immersive English learning environment.
We believe that the principal competitive factors in our markets include the following: ● scope and quality of course offerings; ● quality and performance of the tutors; ● overall student experience and satisfaction; ● brand recognition; ● ability to effectively market course offerings to a broad base of prospective students; ● cost-effectiveness of courses; ● ability to provide students access to courses; and ● ability to align course offerings to specific needs of students.
We believe that the principal competitive factors in our markets include the following: ● scope and quality of course offerings; ● quality and performance of the tutors; ● overall student experience and satisfaction; 46 Table of Contents ● brand recognition; ● ability to effectively market course offerings to a broad base of prospective students; ● cost-effectiveness of courses; ● ability to provide students access to courses; and ● ability to align course offerings to specific needs of students.
However, for corporations with net taxable income of not more than five million Pesos and total assets not exceeding one hundred million Pesos, the tax rate shall be 20%. ​ 62 Table of Contents However, there are instances wherein corporations are not subject to the twenty-five (25%) corporate income tax rate for a certain amount of time.
However, for corporations with net taxable income of not more than five million Pesos and total assets not exceeding one hundred million Pesos, the tax rate shall be 20%. However, there are instances wherein corporations are not subject to the twenty-five (25%) corporate income tax rate for a certain amount of time.
Effective Practice Students are required to preview course materials through the AI-empowered knowledge preview. Pre-lesson learning is particularly important, as such process allows students to engage in more productive interactions with tutors or other students during live lessons. ​ 54 Table of Contents Our AI-empowered knowledge preview aims to develop students’ English speaking, listening, reading and writing skills.
Effective Practice Students are required to preview course materials through the AI-empowered knowledge preview. Pre-lesson learning is particularly important, as such process allows students to engage in more productive interactions with tutors or other students during live lessons. Our AI-empowered knowledge preview aims to develop students’ English speaking, listening, reading and writing skills.
According to Article 4.1 of the Investment Law, an Investor shall have the rights of being treated equally to other investors and being treated fairly and justly, among others. 71 Table of Contents Income Tax Law The Income Tax Law gathers rules and regulatory procedures for income tax within the Kingdom of Saudi Arabia.
According to Article 4.1 of the Investment Law, an Investor shall have the rights of being treated equally to other investors and being treated fairly and justly, among others. Income Tax Law The Income Tax Law gathers rules and regulatory procedures for income tax within the Kingdom of Saudi Arabia.
The primary function of our tele-marketing personnel is to encourage prospective students who have registered their information on our online and mobile platforms to sign-up for free trial lessons and to assist with the sign-up process. We offer free trial lessons to prospective students.
The primary function of our tele-marketing personnel is to encourage prospective students who have registered their information on our online and mobile platforms to sign-up for free trial lessons and to assist with the sign-up process. 45 Table of Contents We offer free trial lessons to prospective students.
The following table sets forth our key operating data of international business for the years indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, 2022 2023 2024 Summary of Operating Data Gross billings (1) (in US$ millions) 28.7 39.9 69.6 Active students with general lesson consumption (2) (in thousands) 26.4 51.9 97.5 Paying students (3) (in thousands) 25.3 37.4 68.3 Average spending per paying student (in US$ thousands) 1.1 1.1 1.0 Notes: (1) “Gross billings” for a specific period refer to the total amount of cash received and receivable from third party payment platforms for the sale of course packages and services in such period, net of the total amount of refunds in such period.
The following table sets forth our key operating data of international business for the years indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ ​ ​ ​ ​ 2023 ​ ​ ​ 2024 ​ ​ ​ 2025 Summary of Operating Data ​ ​ ​ Gross billings (1) (in US$ millions) 39.9 69.6 127.6 Active students with general lesson consumption (2) (in thousands) 51.9 97.5 176.7 Paying students (3) (in thousands) 37.4 68.3 123.3 Average spending per paying student (in US$ thousands) 1.1 1.0 1.0 Notes: (1) “Gross billings” for a specific period refer to the total amount of cash received and receivable from third party payment platforms for the sale of course packages and services in such period, net of the total amount of refunds in such period.
It also supports live lessons with features specifically designed for mobile devices. We continually upgrade and optimize our mobile app to improve our student experience. Approximately 99.6% of our active students accessed our mobile platform at least once in 2024. We offer our mobile app on both iOS and Android.
It also supports live lessons with features specifically designed for mobile devices. We continually upgrade and optimize our mobile app to improve our student experience. Approximately 99.7% of our active students accessed our mobile platform at least once in 2025. We offer our mobile app on both iOS and Android.
Our 51Talk mobile app, which serves as an integral part of our students’ overall learning experience, allows students to book and manage lessons, access pre-lesson preparation and review materials, and take lessons at locations of their choice. Approximately 99.6% of our active students utilized our mobile app in 2024.
Our 51Talk mobile app, which serves as an integral part of our students’ overall learning experience, allows students to book and manage lessons, access pre-lesson preparation and review materials, and take lessons at locations of their choice. Approximately 99.7% of our active students utilized our mobile app in 2025.
(8) In November 2022, Helloworld Education Online (Thailand) Co., Ltd., or Helloworld Education Thailand, was incorporated as a subsidiary of our company to operate our business in Thailand. Helloworld Online Singapore, Ms. Piyanuch Thiensri and Ms. Chularak Aramruansakul hold 49%, 26% and 25% of the equity interest in Helloworld Thailand, respectively.
(8) In November 2022, Helloworld Education Online (Thailand) Co., Ltd., or Helloworld Education Thailand, was incorporated as a subsidiary of our company to operate our business in Thailand. HelloWorld Online Singapore, Ms. Piyanuch Thiensri and Ms. Chulaluk Aramruangsakul hold 49%, 26% and 25% of the equity interest in Helloworld Education Thailand, respectively.
In the Middle East, we offer our package with a wide range of prices from US$512 to US$2,880, catering to the varied spending power of users. We expect that in 2025, we will further deepen the penetration of our one-on-one online English lesson business in the countries and regions where we are currently operating as well as explore new markets.
In the Middle East, we offer our package with a wide range of prices from US$528 to US$2,960, catering to the varied spending power of users. We expect that in 2026, we will further deepen the penetration of our one-on-one online English lesson business in the countries and regions where we are currently operating as well as explore new markets.
We received aggregate gross proceeds from the follow-on public offering of approximately US$6.2 million. In December 2021, Helloworld Online Education Pte. Ltd. was incorporated as a wholly owned subsidiary of our company to operate the international business in Singapore. In April 2022, 51Talk Training SDN.
We received aggregate gross proceeds from the follow-on public offering of approximately US$6.2 million. In December 2021, Helloworld Online Education Pte. Ltd. was incorporated as a wholly owned subsidiary of our company to operate the international business in Singapore.
Students In 2022, 2023 and 2024, we had 26.4 thousand, 51.9 thousand and 97.5 thousand active students with general lesson consumption from international business, respectively. An “active student with general lesson consumption” for a specified period refers to a student who booked at least one paid lesson, excluding those students who only attended paid live broadcasting lessons or trial lessons.
Students In 2023, 2024 and 2025, we had 51.9 thousand, 97.5 thousand and 176.7 thousand active students with general lesson consumption from international business, respectively. An “active student with general lesson consumption” for a specified period refers to a student who booked at least one paid lesson, excluding those students who only attended paid live broadcasting lessons or trial lessons.
Companies are labeled platinum, green, yellow, and red according to their Saudization Percentage, and compliance is directly linked to the company’s application for work visas and payment of taxes. According to the Saudi labour Law, except for special circumstances where there are not enough qualified Saudi employees, the Saudization Percentage of a company should not be less than 75%.
Companies are labeled Red, Low Green, Medium Green, High Green and Platinum according to their Saudization Percentage, and compliance is directly linked to the company’s application for work visas. According to the Saudi labour Law, except for special circumstances where there are not enough qualified Saudi employees, the Saudization Percentage of a company should not be less than 75%.
Helloworld Online Singapore holds ordinary shares, and each ordinary share is entitled to one vote. Ms. Piyanuch Thiensri and Ms. Chularak Aramruansakul hold preference shares, and ten preference shares is entitled to one vote. As a result, we, through Helloworld Online Singapore, hold 90.6% of the voting power of Helloworld Education Thailand.
HelloWorld Online Singapore holds ordinary shares, and each ordinary share is entitled to one vote. Ms. Piyanuch Thiensri and Ms. Chulaluk Aramruangsakul hold preference shares, and ten preference shares are entitled to one vote. As a result, we, through HelloWorld Online Singapore, hold 90.6% of the voting power of Helloworld Education Thailand.
The Ministry of Investment publicizes Saudi Arabia’s recommended investment industries and specific requirements for applying for licenses in various industries through the Service Manual, which is an important operational guide for the investment procedure. The current effective version is the 11th edition (2024).
The Ministry of Investment publicizes Saudi Arabia’s recommended investment industries and specific requirements for applying for licenses in various industries through the Service Manual, which is an important operational guide for the investment procedure. The current effective version is the 12th Edition 05-2025.
This objective will be achieved by requiring employers to register with and contribute to the Workers’ Compensation Fund and by having the Department of Labour Protection and Social Welfare pay the above compensation that employers are required to pay under the Occupational Safety and Health Act instead of employees.
This objective will be achieved by requiring employers to register with and contribute to the Workers’ Compensation Fund and by having the Department of Labour Protection and Social Welfare pay the above compensation that employers are required to pay under the Occupational Safety and Health Act instead of employees. The contribution rate should be 0.2% - 1%.
Particularly, the PCC has the power to review, motu proprio, mergers and acquisitions which it believes, based on reasonable grounds, are likely to substantially prevent, restrict or lessen competition in the market.
The Philippine Competition Commission (PCC) is able to review transactions motu proprio. Particularly, the PCC has the power to review, motu proprio, mergers and acquisitions which it believes, based on reasonable grounds, are likely to substantially prevent, restrict or lessen competition in the market.
Based on this assessment and the data we had gathered from student questionnaires, our course consultants recommend an appropriate starting level and provide advice as to the most appropriate course package and study plan for each prospective student. As of December 31, 2024, we had a total of 421 dedicated course consultants (including 156 full-time employees and 265 outsourced personnel).
Based on this assessment and the data we had gathered from student questionnaires, our course consultants recommend an appropriate starting level and provide advice as to the most appropriate course package and study plan for each prospective student. As of December 31, 2025, we had a total of 743 dedicated course consultants (including 183 full-time employees and 560 outsourced personnel).
In compliance with, and in order to take advantage of the above rules, as of December 31, 2024, we registered five software copyrights in mainland China. Patents The NPC Standing Committee adopted the Patent Law of the People’s Republic of China in 1984 and amended it in 1992, 2000, 2008 and 2020, respectively.
In compliance with, and in order to take advantage of the above rules, as of December 31, 2025, we registered nine software copyrights in mainland China. ​ 59 Table of Contents Patents The NPC Standing Committee adopted the Patent Law of the People’s Republic of China in 1984 and amended it in 1992, 2000, 2008 and 2020, respectively.
Property, Plants and Equipment We maintain offices in Pasig City, Philippines, Hong Kong, Kuala Lumpur, Malaysia and other places outside mainland China with an aggregate of 3,958 square meters. These facilities accommodate part of our sales and marketing and general and administrative activities.
Property, Plants and Equipment We maintain offices in Pasig City, Philippines, Riyadh, Saudi Arabia, Hong Kong, Kuala Lumpur, Malaysia and other places outside mainland China with an aggregate of 9,642 square meters. These facilities accommodate part of our sales and marketing and general and administrative activities.
In these markets, we mainly conduct one-on-one online live English courses, targeting children aged five to twelve. In Hong Kong, we offer our packages with a wide range of prices from US$700 to US$2,350. In Thailand, we offer our packages with a wide range of prices from US$374 to US$2,369, catering to the varied spending power of users.
In these markets, we mainly conduct one-on-one online live English courses, targeting children aged five to twelve. In Hong Kong, we offer our packages with a wide range of prices from US$680 to US$2,200. In Thailand, we offer our packages with a wide range of prices from US$365 to US$2,640, catering to the varied spending power of users.
In January 2024, HAWO EDUCATION INVESTMENT -FZCO, or UAE INVESTMENT, was incorporated as a wholly owned subsidiary of HelloWorld Online Singapore in United Arab Emirates. In February 2024, Hawo Online Training L.L.C-FZ, or UAE Training, was incorporated as a wholly owned subsidiary of HelloWorld Online Singapore in United Arab Emirates.
(13) In February 2024, Hawo Online Training L.L.C-FZ, or UAE Training, was incorporated as a wholly owned subsidiary of HelloWorld Online Singapore in United Arab Emirates.
Both one-on-one and small class programs comprise AI-empowered knowledge preview and AI-empowered post-lesson practices and assessment. In order to recommend the proper course level that a new student should take, we first assess the student’s English proficiency, using a 11-level scale for K-12 students and a 16-level scale for post-secondary students.
Our one-on-one program comprises AI-empowered knowledge preview and AI-empowered post-lesson practices and assessment. In order to recommend the proper course level that a new student should take, we first assess the student’s English proficiency, using an 11-level scale for K-12 students and a 16-level scale for post-secondary students.
We marketed our platform through a combination of online and offline channels. For the online channel, we use advertising via content platforms. For the offline channel, we use promotions as well as hosting joint activities with brands from other segments.
As a result, we have revamped our marketing model for the international markets. We marketed our platform through a combination of online and offline channels. For the online channel, we use advertising via content platforms. For the offline channel, we use promotions as well as hosting joint activities with brands from other segments.
Jiajia Jack Huang, our chairman and chief executive officer, pursuant to which Mr. Jiajia Jack Huang, through Dasheng, acquired our China Mainland Business, i.e., all of our online English tutoring businesses in mainland China, including all associated liabilities and assets, for US$1. This transaction was completed on June 30, 2022.
Jack Jiajia Huang, through Dasheng, acquired our China Mainland Business, i.e., all of our online English tutoring businesses in mainland China, including all associated liabilities and assets, for US$1. This transaction was completed on June 30, 2022.
DCM Funds, including DCM Hybrid RMB Fund, L.P., DCM Ventures China Turbo Fund, L.P. and DCM Ventures China Turbo Affiliates Fund, L.P., beneficially owned 19.4% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025, which represents 45.7% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025.
DCM Funds, including DCM Hybrid RMB Fund, L.P., DCM Ventures China Turbo Fund, L.P. and DCM Ventures China Turbo Affiliates Fund, L.P., beneficially owned 18.9% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026, which represents 45.4% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026.
Other shareholders including certain principal shareholders, beneficially own 33.3% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025, which represents 9.1% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025. 78 Table of Contents (2) Each of Noel Lee, Huiru Yuan, Jennifer Que, Arman James Manalang and Samuel Celestino holds 0.000001% of the equity interest in Philippines Co II.
Other shareholders including certain principal shareholders, beneficially own 34.9% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026, which represents 9.7% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026. 65 Table of Contents (2) Each of Noel Lee, Huiru Yuan, Jennifer Que, Arman James Manalang and Samuel Celestino holds 0.000001% of the equity interest in Philippines Co II.
As of December 31, 2024, we had a total of 250 account managers (including 90 full-time employees and 160 outsourced personnel). Our account manager team plays a critical role in increasing the course package upgrades and renewals among our students.
As of December 31, 2025, we had a total of 430 account managers (including 70 full-time employees and 360 outsourced personnel). Our account manager team plays a critical role in increasing the course package upgrades and renewals among our students.
Regulations on Cybersecurity BSP Circular No. 808, Series of 2013 provides for the guidelines on technology risk management applicable to all BSP-supervised institutions and requires BSP supervised institutions to establish a robust technology risk management system covering the following components: (1) technology governance, (2) risk identification and assessment, (3) technology control implementation, and (4) risk measurement and monitoring. ​ 61 Table of Contents Regulations on Competition Law The Philippine Competition Act is the primary competition policy of the Philippines.
Regulations on Cybersecurity BSP Circular No. 808, Series of 2013 provides for the guidelines on technology risk management applicable to all BSP-supervised institutions and requires BSP supervised institutions to establish a robust technology risk management system covering the following components: (1) technology governance, (2) risk identification and assessment, (3) technology control implementation, and (4) risk measurement and monitoring.
To build a more instinctive understanding of the English language for our students, our pre-lesson studying system relies on graphic illustrations to explain the meaning of vocabulary and phrases. Tutors Our teaching staff is critical to the quality of our programs and to promoting our brand and reputation. We have assembled a large pool of tutors in the Philippines.
To build a more instinctive understanding of the English language for our students, our pre-lesson studying system relies on graphic illustrations to explain the meaning of vocabulary and phrases. 41 Table of Contents Tutors Our teaching staff is critical to the quality of our programs and to promoting our brand and reputation.
Our net revenues from international business increased from US$15.0 million in 2022 to US$27.1 million in 2023, and further to US$50.7 million in 2024. Our gross billings from international business increased from US$28.7 million in 2022 to US$39.9 million in 2023, and further to US$69.6 million in 2024.
Our net revenues from international business increased from US$27.1 million in 2023 to US$50.7 million in 2024, and further to US$95.6 million in 2025. Our gross billings from international business increased from US$39.9 million in 2023 to US$69.6 million in 2024, and further to US$127.6 million in 2025.
For example, the labour contract of non-Saudi nationals must be in writing and a fixed-term contract. The contract must be terminated when the foreigner’s work visa expires, and a foreigner can only provide services to one employer. If the contract does not specify the term, it is deemed to be one year from the date the employee starts working.
The contract must be terminated when the foreigner’s work visa expires, and a foreigner can only provide services to one employer. If the contract does not specify the term, it is deemed to be one year from the date the employee starts working.
Each student has access to a large pool of qualified foreign tutors. Students have the flexibility to select tutors based on a wide range of attributes, including their rating and feedback from other students, as well as teaching aptitudes and characteristics.
Students have the flexibility to select tutors based on a wide range of attributes, including their rating and feedback from other students, as well as teaching aptitudes and characteristics.
We incurred net loss from international business of US$12.8 million, US$15.0 million and US$7.3 million in 2022, 2023 and 2024, respectively.
We incurred net loss from international business of US$15.0 million, US$7.3 million and US$16.9 million in 2023, 2024 and 2025, respectively.
Golien Ltd beneficially owned 5.4% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025, which represents 1.6% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as- converted basis as of February 28, 2025.
Golien Ltd beneficially owned 5.3% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026, which represents 1.5% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as- converted basis as of March 18, 2026.
According to the CREATE law, those granted an income tax holiday prior to the effectivity of the law and are entitled to 5% tax on gross income earned shall be allowed to continue to avail of the five percent (5%) tax on gross income earned incentive for ten (10) years while those availing of the five percent (5%) tax on gross income earned prior the effectivity of the law shall be allowed to continue availing the said incentive for ten (10) years.
Since 2022, the PEZA registration of Philippine Co II has expired. 49 Table of Contents According to the CREATE law, those granted an income tax holiday prior to the effectivity of the law and are entitled to 5% tax on gross income earned shall be allowed to continue to avail of the five percent (5%) tax on gross income earned incentive for ten (10) years while those availing of the five percent (5%) tax on gross income earned prior the effectivity of the law shall be allowed to continue availing the said incentive for ten (10) years.
The contribution rate should be 0.2% - 1%. 68 Table of Contents Labour Protection Act The Thailand Labour Protection Act (“LPA”) is a comprehensive law that sets out the rights and obligations of employers and employees in the workplace. It aims to protect the welfare of workers and ensure fair treatment.
Labour Protection Act The Thailand Labour Protection Act (“LPA”) is a comprehensive law that sets out the rights and obligations of employers and employees in the workplace. It aims to protect the welfare of workers and ensure fair treatment.
Except under certain specific circumstances provided by law, any third party user must obtain consent or a proper license from the patent owner to use the patent, or else the use will constitute an infringement of the rights of the patent holder.
Except under certain specific circumstances provided by law, any third party user must obtain consent or a proper license from the patent owner to use the patent, or else the use will constitute an infringement of the rights of the patent holder. As of December 31, 2025, we held six patents in mainland China.
Shu and their family members, beneficially owned 24.6% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025, which represents 38.9% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025.
Shu and their family members, beneficially owned 24.5% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026, which represents 38.8% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026.
The Ministry of Investment of Saudi Arabia (MISA) is the competent authority for foreign investors to invest in Saudi Arabia. Foreign investors who carry out investment activities and establish legal entities in Saudi Arabia must register with MISA in advance and obtain an “investment license” issued by MISA.
Foreign investors who carry out investment activities and establish legal entities in Saudi Arabia must register with MISA in advance and obtain an “investment license” issued by MISA.
We lease all of the facilities that we currently occupy from independent third parties. 80 Table of Contents We believe that the facilities that we currently lease are adequate to meet our needs for the foreseeable future, and we believe that we will be able to obtain adequate facilities, principally through leasing of additional properties, to accommodate our future expansion plans. ​ ITEM 4.A.
We believe that the facilities that we currently lease are adequate to meet our needs for the foreseeable future, and we believe that we will be able to obtain adequate facilities, principally through leasing of additional properties, to accommodate our future expansion plans. ​ 67 Table of Contents ITEM 4.A. UNRESOLVED STAFF COMMENTS Not Applicable. ​
Regulations Relating to Foreign Exchange Registration of Overseas Investment by Mainland China Residents The Circular on Relevant Issues Relating to Domestic Resident’s Investment and Financing and Roundtrip Investment through Special Purpose Vehicles, or SAFE Circular 37, issued by SAFE taking effect on July 4, 2014, regulates foreign exchange matters in relation to the use of special purpose vehicles, or SPVs, by mainland China residents or entities to seek offshore investment and financing and conduct round trip investment in mainland China.
Foreign currency revenues received by mainland China companies may be repatriated into mainland China or retained outside of mainland China in accordance with requirements and terms specified by SAFE. 61 Table of Contents Regulations Relating to Foreign Exchange Registration of Overseas Investment by Mainland China Residents The Circular on Relevant Issues Relating to Domestic Resident’s Investment and Financing and Roundtrip Investment through Special Purpose Vehicles, or SAFE Circular 37, issued by SAFE taking effect on July 4, 2014, regulates foreign exchange matters in relation to the use of special purpose vehicles, or SPVs, by mainland China residents or entities to seek offshore investment and financing and conduct round trip investment in mainland China.
We will further upgrade and refine our English course offerings to better meet the demands of local users in terms of localized course content, payment channels and customer services. We strive to provide more English learners with the opportunity to communicate with the world through our platform.
We will further upgrade and refine our English course offerings to better meet the demands of local users in terms of localized course content, payment channels and customer services.
New enrollments through word-of-mouth referrals have benefited from the rapid growth in our student base, as well as our reputation, brand and the proven learning results of our students.
Referrals We have historically generated a significant percentage of our sales leads through word-of-mouth referrals by our students and parents. New enrollments through word-of-mouth referrals have benefited from the rapid growth in our student base, as well as our reputation, brand and the proven learning results of our students.
As part of our efforts to increase K-12 enrollment in countries and regions outside of mainland China, we also place advertisements on online parenting community portals and regional information flow in order to reach a broader audience of parents of prospective students there. ​ 58 Table of Contents Referrals We have historically generated a significant percentage of our sales leads through word-of-mouth referrals by our students and parents.
As part of our efforts to increase K-12 enrollment in countries and regions outside of mainland China, we also place advertisements on online parenting community portals and regional information flow in order to reach a broader audience of parents of prospective students there.
Workmen Compensation Fund The Workmen’s Compensation Fund was established under the Workmen’s Compensation Act, B.E. 2537 (1994) (“WCA”) to ensure that adequate compensation is paid when workers are injured, become ill, or die as a result of their work, or as a result of illnesses arising out of the nature or conditions of the work, or as the Department of the Interior may prescribe.
If the company increases the number of employees, it must submit a new employee registration form for each new employee. 54 Table of Contents Workmen Compensation Fund The Workmen’s Compensation Fund was established under the Workmen’s Compensation Act, B.E. 2537 (1994) (“WCA”) to ensure that adequate compensation is paid when workers are injured, become ill, or die as a result of their work, or as a result of illnesses arising out of the nature or conditions of the work, or as the Department of the Interior may prescribe.
Other obligations that organizations must comply with relate to accountability, protection, retention, and requirements around the international transfers of personal data. 63 Table of Contents In addition, Do-Not-Call requirements require organizations to, among others, check “Do-Not-Call” registries prior to sending specified marketing messages addressed to Singapore telephone numbers, through voice calls, fax or text messages, unless clear and unambiguous consent to the sending of the message to their number was obtained from the individual.
In addition, Do-Not-Call requirements require organizations to, among others, check “Do-Not-Call” registries prior to sending specified marketing messages addressed to Singapore telephone numbers, through voice calls, fax or text messages, unless clear and unambiguous consent to the sending of the message to their number was obtained from the individual.
Huang and his family members, beneficially owned 5.9% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025, which represents 1.6% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as- converted basis as of February 28, 2025.
Huang and his family members, beneficially owned 8.5% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026, which represents 2.4% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as- converted basis as of March 18, 2026.
We employ student and teacher feedback and data analytics to deliver a personalized learning experience. Our platform analyzes tutors’ teaching aptitudes, feedback and rating from students as well as background, and recommends suitable tutors to students according to their respective characteristics and learning objectives.
Our platform analyzes tutors’ teaching aptitudes, feedback and rating from students as well as background, and recommends suitable tutors to students according to their respective characteristics and learning objectives.
A company having one or more employees must register with the Social Security Office (“SSO”) for the Fund within 30 days after hiring the first employee. If the company increases the number of employees, it must submit a new employee registration form for each new employee.
A company having one or more employees must register with the Social Security Office (“SSO”) for the Fund within 30 days after hiring the first employee.
Jack Jiajia Huang and Ting Shu, who directly or indirectly hold shares in our Cayman Islands holding company and who are mainland China residents have completed the initial foreign exchange registrations and amended their registrations to reflect our corporate restructuring in November 2014, but have not updated their registrations required in connection with our recent corporate restructuring. 75 Table of Contents Regulations on Stock Incentive Plans Pursuant to the Notice on Issues Concerning the Foreign Exchange Administration for Domestic Individuals Participating in Stock Incentive Plan of Overseas Publicly Listed Company, or SAFE Circular 7, issued by SAFE in February 2012, employees, directors, supervisors and other senior management participating in any stock incentive plan of an overseas publicly listed company who are mainland China citizens or who are non-mainland China citizens residing in mainland China for a continuous period of not less than one year, subject to a few exceptions, are required to register with SAFE through a domestic qualified agent, which could be a mainland China subsidiaries of such overseas listed company, and complete certain other procedures.
Regulations on Stock Incentive Plans Pursuant to the Notice on Issues Concerning the Foreign Exchange Administration for Domestic Individuals Participating in Stock Incentive Plan of Overseas Publicly Listed Company, or SAFE Circular 7, issued by SAFE in February 2012, employees, directors, supervisors and other senior management participating in any stock incentive plan of an overseas publicly listed company who are mainland China citizens or who are non-mainland China citizens residing in mainland China for a continuous period of not less than one year, subject to a few exceptions, are required to register with SAFE through a domestic qualified agent, which could be a mainland China subsidiaries of such overseas listed company, and complete certain other procedures.
The pre-establishment national treatment refers to granting foreign investors and their investments, in the stage of investment access, the treatment no less favorable than that granted to domestic investors and their investments; the negative list refers to special administrative measures for access of foreign investments in certain fields and the national treatment will be given to the foreign investments that do not fall within any of the categories set out in the negative list. 74 Table of Contents On September 6, 2024, the Ministry of Commerce and the National Development and Reform Commission jointly promulgated the Special Administrative Measures for Access of Foreign Investment (Negative List) (2024 version), which became effective on November 1, 2024.
The pre-establishment national treatment refers to granting foreign investors and their investments, in the stage of investment access, the treatment no less favorable than that granted to domestic investors and their investments; the negative list refers to special administrative measures for access of foreign investments in certain fields and the national treatment will be given to the foreign investments that do not fall within any of the categories set out in the negative list.
We have prepaid credit packages with minimum monthly consumption of eight to fifteen credits in different countries and regions to help international students build study habits.
We have prepaid credit packages with minimum monthly consumption of eight to fifteen credits in different countries and regions to help international students build study habits. To offer our students more options and especially during promotional campaigns, we also offer different types of prepaid credit packages with various number of credits.
Companies that offer online courses or other educational services are required that their offerings meet the standards set out in the Education Ordinance. Companies may also need to obtain licenses or approvals from the Education Bureau or other authorities before offering their services. Companies that violate the regulations may be subject to fines and other penalties.
Companies may also need to obtain licenses or approvals from the Education Bureau or other authorities before offering their services. Companies that violate the regulations may be subject to fines and other penalties.
Course Content Development Team We have dedicated course content development teams mainly based in Beijing, employing a total of six professionals as of December 31, 2024. Our content development team members focus exclusively on developing, updating and improving our curriculum and course materials.
Course Content Development Team We have dedicated course content development teams based in mainland China and some other countries and regions where we operate employing a total of 24 professionals as of December 31, 2025. Our content development team members focus exclusively on developing, updating and improving our curriculum and course materials.
Regulations on Communications and Multimedia The Communications and Multimedia Act regulates the use of the internet and digital content in Malaysia, including ensuring that their advertising is truthful and not misleading.
Infringement of the Personal Data Protection Act 2010 may result in fines and imprisonment. 53 Table of Contents Regulations on Communications and Multimedia The Communications and Multimedia Act regulates the use of the internet and digital content in Malaysia, including ensuring that their advertising is truthful and not misleading.
(11) In January 2024, HAWO EDUCATION INVESTMENT -FZCO, or UAE INVESTMENT, was incorporated as a wholly owned subsidiary of HelloWorld Online Singapore in United Arab Emirates.
(11) In July 2023, HelloWorld Online Education Jordan LLC, or HelloWorld Jordan, was incorporated as a wholly owned subsidiary of our Company to operate the international business in Jordan. (12) In January 2024, HAWO EDUCATION INVESTMENT -FZCO, or UAE INVESTMENT, was incorporated as a wholly owned subsidiary of HelloWorld Online Singapore in United Arab Emirates.
Risk Factors—Risks Related to Our Business and Industry—We have limited insurance coverage for our operations in the countries and regions where we operate our business, which could expose us to significant costs and business disruption.” Government Regulations Philippine Regulations This section sets forth a summary of the most significant rules and regulations that affect our business activities in the Philippines.
Risk Factors—Risks Related to Our Business and Industry—We have limited insurance coverage for our operations in the countries and regions where we operate our business, which could expose us to significant costs and business disruption.” Government Regulations Philippine Regulations This section sets forth a summary of the most significant rules and regulations that affect our business activities in the Philippines. 47 Table of Contents Regulations on Data Privacy The Republic Act No. 10173, or the Data Privacy Act of 2012, its implementing rules and regulations, and the issuances of the National Privacy Commission (the “ NPC ”) govern the processing of all types of personal information.
A lesson is considered “booked” when it is taken or when the student to such lesson is confirmed absent. ​ 57 Table of Contents Student Services We employ a service-oriented approach and devote significant resources to developing course-related support and services for our students.
A lesson is considered “booked” when it is taken or when the student to such lesson is confirmed absent. Student Services We employ a service-oriented approach and devote significant resources to developing course-related support and services for our students. Our technology support personnel are available during lesson hours to monitor and provide real-time support services to students encountering technical difficulties.
A company is formed with the registered capital and divided into shares to be subscribed by the promoters or shareholders. The liability of the shareholders being limited to the amount unpaid on the shares respectively held by them. Foreign Business Act Thai law imposes restrictions on foreigners engaging in certain business activities.
The liability of the shareholders being limited to the amount unpaid on the shares respectively held by them. Foreign Business Act Thai law imposes restrictions on foreigners engaging in certain business activities. The principal law with respect to foreign participation in various business activities is the Foreign Business Act, or the FBA.
The competent court is responsible for resolving disputes, including claims for compensation arising from the application of the provisions of the law. 70 Table of Contents Electronic Transactions Law The issuance of Saudi Arabian Electronic Transactions Law constitutes significant development in the legal structure of the electronic transactions system as well as in controlling, regulating and providing a legal framework for electronic transactions and signatures in general, thus providing effect and validity for these transactions.
Electronic Transactions Law The issuance of Saudi Arabian Electronic Transactions Law constitutes significant development in the legal structure of the electronic transactions system as well as in controlling, regulating and providing a legal framework for electronic transactions and signatures in general, thus providing effect and validity for these transactions.
After each lesson, the student is encouraged to assess their learning outcome by taking the post-lesson quizzes. Live lessons One-on-one lessons with foreign tutors We believe one-on-one live lessons foster the interactions between students and tutors as well as afford students tutors’ individual attention, which are key to an effective English learning experience.
Live lessons One-on-one lessons with foreign tutors We believe one-on-one live lessons foster the interactions between students and tutors as well as afford students tutors’ individual attention, which are key to an effective English learning experience. Each student has access to a large pool of qualified foreign tutors.
Our tutors deliver lessons based on their individual availability, at appropriate locations of their choice, and are paid according to the number of lessons they teach. Tutors who deliver paid lessons are generally engaged by us as independent contractors. As of December 31, 2024, we had approximately 7.0 thousand foreign tutors qualified to deliver lessons on our platform.
We have assembled a large pool of tutors in the Philippines. Our tutors deliver lessons based on their individual availability, at appropriate locations of their choice, and are paid according to the number of lessons they teach. Tutors who deliver paid lessons are generally engaged by us as independent contractors.
Contractual Arrangement with Our Subsidiaries in the Philippines and Its Shareholders Under the Philippine Corporation Code, the business, assets and affairs of a corporation are handled and managed by a board of directors, which is composed of the number of individuals mandated under the corporation’s articles of incorporation.
(14) In July 2025, HELLOWORLD ONLINE EDUCATION VIETNAM COMPANY LIMITED, or HELLOWORLD ONLINE EDUCATION VIETNAM, was incorporated as a wholly owned subsidiary of HelloWorld Online Singapore in Vietnam. 66 Table of Contents Contractual Arrangement with Our Subsidiaries in the Philippines and Its Shareholders Under the Philippine Corporation Code, the business, assets and affairs of a corporation are handled and managed by a board of directors, which is composed of the number of individuals mandated under the corporation’s articles of incorporation.
We then broadly release such new versions on our platform after we have incorporated the feedback. We regularly release updates to our course materials. We will continue to launch new courses in the future to meet the varied interests and English learning needs of our young students and to realize greater cross-selling opportunities.
We will continue to launch new courses in the future to meet the varied interests and English learning needs of our young students and to realize greater cross-selling opportunities.
We offer our tutors career advancement prospects with competitive service fees. The service fees of our tutors are based on student reviews, number of lessons taught and the completion of on-going training. Each advancement along the seven-star system results in a pay raise for each lesson taught.
The service fees of our tutors are based on student reviews, number of lessons taught and the completion of on-going training. With each promotion within the multi-tiered system, tutors receive a pay raise for each lesson taught.
Sequoia Capital China Investment Funds, including SCC Venture V Holdco I, Ltd. and SCC Growth I Holdco A, Ltd., beneficially owned 11.4% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025, which represents 3.1% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of February 28, 2025.
HongShan Investment Funds, including HSG Venture V Holdco I, Ltd., beneficially owned 7.9% of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026, which represents 2.2% of the aggregate voting power of our total issued and outstanding Class A and Class B ordinary shares on an as-converted basis as of March 18, 2026.
The Personal Data Protection Standard 2015 further prescribes the minimum requirement for data security in processing personal data. Infringement of the Personal Data Protection Act 2010 may result in fines and imprisonment.
The Personal Data Protection Standard 2015 further prescribes the minimum requirement for data security in processing personal data.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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This decrease was primarily due to the increase in headcount and personnel - related expenses Product Development Expenses Our product development expenses from our international business operations increased by 15.6% from US$3.1 million in 2023 to US$3.6 million in 2024.
This increase was primarily due to the increase in headcount and personnel - related expenses Product Development Expenses Our product development expenses from our international business operations increased by 15.6% from US$3.1 million in 2023 to US$3.6 million in 2024.
Ltd., is subject to 17% Singapore corporate income tax on its taxable income generated from operations in Singapore for the year 2024. In 2024, HelloWorld Online Education Pte. Ltd. was in a loss position, hence no taxable profit was reported during such period. Malaysia Our subsidiary in Malaysia, 51TALK TRAINING SDN. BHD was incorporated in April 2022.
Ltd., is subject to 17% Singapore corporate income tax on its taxable income generated from operations in Singapore for the year 2025. In 2025, HelloWorld Online Education Pte. Ltd. was in a loss position, hence no taxable profit was reported during such period. Malaysia Our subsidiary in Malaysia, 51TALK TRAINING SDN. BHD was incorporated in April 2022.
The fluctuation was primarily due to, in 2024, the reversal of the provision for interests and penalties of the taxes that were recognized in 2023. 86 Table of Contents Income Tax Expenses We recorded income tax expenses from our international business operations of US$0.1 million in 2023 and US$0.3 million in 2024, respectively.
The fluctuation was primarily due to, in 2024, the reversal of the provision for interests and penalties of the taxes that were recognized in 2023. 73 Table of Contents Income Tax Expenses We recorded income tax expenses from our international business operations of US$0.1 million in 2023 and US$0.3 million in 2024, respectively.
Trend Information Other than as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the year ended December 31, 2024 that are reasonably likely to have a material effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future operating results or financial conditions. ​ 93 Table of Contents E.
Trend Information Other than as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the year ended December 31, 2025 that are reasonably likely to have a material effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future operating results or financial conditions. 77 Table of Contents E.
Our net revenues are presented net of value - added tax. Cost of Revenues Our cost of revenues primarily consists of service fees to our tutors who delivered paid lessons, payment processing fees charged by third party payment channels, cost of server and bandwidth and compensation to personnel providing support for our services.
Our net revenues are presented net of value - added tax. 68 Table of Contents Cost of Revenues Our cost of revenues primarily consists of service fees to our tutors who delivered paid lessons, payment processing fees charged by third party payment channels, cost of server and bandwidth and compensation to personnel providing support for our services.
For the years ended December 31, 2022, 2023 and 2024, there was no taxable profit for COE HK Co II. For the years ended December 31, 2022, 2023 and 2024, there was no taxable profit for HelloWorld Online HK.
For the years ended December 31, 2023, 2024 and 2025, there was no taxable profit for COE HK Co II. For the years ended December 31, 2023, 2024 and 2025, there was no taxable profit for Helloworld Online HK.
Our consolidated financial statements for 2024 had been prepared on a going concern basis, which contemplates the realization of assets and liquidation of liabilities during the normal course of operations. We incurred net losses of US$12.8 million, US$15.0 million and US$7.3 million from international business operations for the fiscal years ended December 31, 2022, 2023 and 2024, respectively.
Our consolidated financial statements for 2025 had been prepared on a going concern basis, which contemplates the realization of assets and liquidation of liabilities during the normal course of operations. We incurred net losses of US$15.0 million, US$7.3 million and US$16.9 million from international business operations for the fiscal years ended December 31, 2023, 2024 and 2025, respectively.
We may make acquisitions of businesses and properties that complement our operations when suitable opportunities arise. ​ 91 Table of Contents Material Cash Requirements Other than the ordinary cash requirements for our operations, our material cash requirements as of December 31, 2024, and any subsequent interim period primarily include our operating lease obligations and purchase commitments.
We may make acquisitions of businesses and properties that complement our operations when suitable opportunities arise. Material Cash Requirements Other than the ordinary cash requirements for our operations, our material cash requirements as of December 31, 2025, and any subsequent interim period primarily include our operating lease obligations and purchase commitments.
The enterprise income tax is calculated based on the entity’s global income as determined under PRC tax laws and accounting standards. We are subject to value-added tax at a rate of 6%, 9% and 13% on the goods/products we provide, less any deductible value-added tax we have already paid or borne.
The enterprise income tax is calculated based on the entity’s global income as determined under PRC tax laws and accounting standards. Our subsidiaries in mainland China are subject to value-added tax at a rate of 6% on services, and 9% or 13% on the goods or products we provide, less any deductible value-added tax we have already paid or borne.
The functional currency of our company and our subsidiaries incorporated in the Cayman Islands, Hong Kong and Singapore is United States dollars, the functional currency of the Philippines entities is Peso, the functional currency of the Thailand entity is Thai Baht, the functional currency of Saudi is Saudi Riyal, the functional currency of the Malaysia entity is Ringgit, the functional currency of United Arab Emirates entities is Dirham and the functional currency of the mainland China entities in our company is RMB.
The functional currency of our company and our subsidiaries incorporated in the Cayman Islands, Hong Kong and Singapore is United States dollars, the functional currency of the Philippines entities is Peso, the functional currency of the Thailand entity is Thai Baht, the functional currency of Saudi is Saudi Riyal, the functional currency of the Malaysia entity is Ringgit, the functional currency of United Arab Emirates entities is Dirham and the functional currency of the mainland China entities in our company is RMB, the functional currency of the Jordan entity is Jordanian Dinar and the functional currency of the Vietnam entity is Vietnamese Dong.
Risk Factors—Risks Related to Our Business and Industry—Unexpected network interruptions, security breaches or computer virus attacks and system failures could have a material adverse effect on our business, financial condition and results of operations.” All of our servers and routers, including backup servers, are currently hosted by third-party service providers in Singapore. We back up our databases daily.
Risk Factors—Risks Related to Our Business and Industry—Unexpected network interruptions, security breaches or computer virus attacks and system failures could have a material adverse effect on our business, financial condition and results of operations.” 76 Table of Contents All of our servers and routers, including backup servers, are currently hosted by third-party service providers in Singapore.
Recent Accounting Pronouncements A list of recently issued accounting pronouncements that are relevant to us is included in Note 2 (z) “recently issued accounting pronouncements” to our consolidated financial statements included elsewhere in this annual report. ​ 94 Table of Contents
Recent Accounting Pronouncements A list of recently issued accounting pronouncements that are relevant to us is included in Note 2 (x) “recently issued accounting pronouncements” to our consolidated financial statements included elsewhere in this annual report. ​
The year over year increase from 2023 to 2024 was primarily due to the increase in advances from students. Net cash provided by operating activities from our international business operations in 2022 and 2023 was US$1.9 million and US$0.6 million, respectively.
The year over year increase from 2024 to 2025 was primarily due to the increase in advances from students. Net cash provided by operating activities from our international business operations in 2023 and 2024 was US$0.6 million and US$5.8 million, respectively. The year over year increase from 2023 to 2024 was primarily due to the increase in advances from students.
Our product development expenses primarily consist of payroll and employee benefits to our personnel involved in course content development, as well as to our employees involved in the research and development of technology for our online and mobile platforms. Taxation Cayman Islands We are incorporated in the Cayman Islands.
Our product development expenses primarily consist of personnel related expenses for employees involved in course content development, as well as for those involved in the research and development of technology for our online and mobile platforms. Taxation Cayman Islands We are incorporated in the Cayman Islands.
The following table sets forth our contractual obligations as of December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less than 1–3 More than ​ ​ Total ​ 1 year ​ years ​ 3 years ​ ​ in US$ thousands Operating lease obligations (1) 2,813 1,519 1,294 — Purchase commitments (2) 747 ​ 745 2 — Notes: (1) Represents our non-cancelable leases for our offices and learning centers, which include all future cash outflows under ASC Topic 842, Leases and the operating leases that have not commenced as of December 31, 2024.
The following table sets forth our contractual obligations as of December 31, 2025: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Less than ​ ​ ​ 1–3 ​ ​ ​ More than ​ ​ Total ​ 1 year ​ years ​ 3 years ​ ​ in US$ thousands Operating lease obligations (1) 3,053 1,686 1,367 — Purchase commitments (2) 724 ​ 724 — — Notes: (1) Represents our non-cancelable leases for our offices and learning centers, which include all future cash outflows under ASC Topic 842, leases and the operating leases that have not commenced as of December 31, 2025.
We assess our liquidity by our ability to generate cash from operating activities to fund our operations, attract investors and borrow funds on favorable economic terms. ​ 90 Table of Contents Operating Activities Net cash provided by operating activities from our international business operations in 2023 and 2024 was US$0.6 million and US$5.8 million, respectively.
We assess our liquidity by our ability to generate cash from operating activities to fund our operations, attract investors and borrow funds on favorable economic terms. Operating Activities Net cash provided by operating activities from our international business operations in 2024 and 2025 was US$5.8 million and US$11.8 million, respectively.
In the consolidated financial statements, the entities located in mainland China, the Philippines, Malaysia, Thailand and Saudi have been translated into USD.
In the consolidated financial statements, the entities located in mainland China, the Philippines, Malaysia, Thailand, Saudi, United Arab Emirates, Jordan and Vietnam have been translated into USD.
To effectively manage cash flow within our organization, we have put in place relevant cash management policies. For a more detailed description of cash flows within our organization and our cash management policies, see “Item 3. Key Information—Cash Flows through Our Organization.” Our ability to distribute earnings to U.S. investors is limited.
For a more detailed description of cash flows within our organization and our cash management policies, see “Item 3. Key Information—Cash Flows through Our Organization.” Our ability to distribute earnings to U.S. investors is limited.
We recorded cost of revenues from continuing operations of US$3.2 million, US$6.3 million and US$11.2 million in 2022, 2023 and 2024, respectively. ​ 82 Table of Contents Operating Expenses Our operating expenses from continuing operations consist of sales and marketing expenses and general and administrative expenses, and to a lesser extent, product development expenses.
We recorded cost of revenues of US$6.3 million, US$11.2 million and US$24.9 million in 2023, 2024 and 2025, respectively. Operating Expenses Our operating expenses consist of sales and marketing expenses and general and administrative expenses, and to a lesser extent, product development expenses.
When any of our subsidiaries incurs debt on its own behalf, the instruments governing the debt may restrict its ability to pay dividends or make other distributions to us. Our subsidiaries’ ability to distribute dividends is based upon their distributable earnings.
When any of our subsidiaries incurs debt on its own behalf, the instruments governing the debt may restrict its ability to pay dividends or make other distributions to us. Our subsidiaries’ ability to distribute dividends is based upon their distributable earnings. In addition, our subsidiaries may be subject to restrictions imposed by local laws and regulations.
Net loss As a result of the foregoing, we incurred net loss from our international business operations of US$15.0 million and US$7.3 million in 2023 and 2024, respectively.
Net loss As a result of the foregoing, we incurred net loss from our international business operations of US$15.0 million and US$7.3 million in 2023 and 2024, respectively. Impact of Foreign Currency Fluctuation See “Item 3. Key Information—D.
Our net revenues increased from US$15.0 million in 2022 to US$27.1 million in 2023, and further to US$50.7 million in 2024. Our gross billings increased from US$28.7 million in 2022 to US$39.9 million in 2023 and further to US$69.6 million in 2024.
Our net revenues increased from US$27.1 million in 2023 to US$50.7 million in 2024, and further to US$95.6 million in 2025. Our gross billings increased from US$39.9 million in 2023 to US$69.6million in 2024 and further to US$127.6 million in 2025.
We mainly offer prepaid credit packages with minimum monthly consumption for our students to purchase. For prepaid credit packages, fees for lessons that have expired are automatically recognized as revenues. We had advances from students from international business of US$27.2 million and US$45.1 million as of December 31, 2023 and 2024, respectively.
For prepaid credit packages, fees for lessons that have expired are automatically recognized as revenues. We had advances from students from international business of US$27.2 million, US$45.1 million, and US$76.6 million, as of December 31, 2023, 2024, and 2025, respectively.
Accumulated deficits were US$353.6 million as of December 31, 2024. The net current liabilities of continuing operations were US$9.3 million and US$16.8 million as of December 31, 2023 and 2024, respectively. The operating cash inflows from continuing operations were US$1.9 million, US$0.6 million and US$5.8 million for the years ended December 31, 2022, 2023 and 2024, respectively.
Accumulated deficits were US$370.4 million as of December 31, 2025. The net current liabilities were US$9.3 million, US$16.8 million and US$35.0 million as of December 31, 2023, 2024 and 2025, respectively. The operating cash inflows were US$0.6 million, US$5.8 million and US$11.8 million for the years ended December 31, 2023, 2024 and 2025, respectively.
The operating results in any period are not necessarily indicative of the results that may be expected for any future period. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2022 ​ 2023 ​ 2024 ​ US$ % US$ % US$ % ​ ​ (in thousands, except for percentages) Net revenues 15,048 ​ 100.0 ​ 27,111 ​ 100.0 ​ 50,692 100.0 Cost of revenues (3,194) ​ 21.2 ​ (6,322) ​ 23.3 ​ (11,164) 22.0 Gross profit 11,854 ​ 78.8 ​ 20,789 ​ 76.7 ​ 39,528 78.0 Operating expenses and other income: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Sales and marketing expenses (13,279) ​ 88.2 ​ (23,637) ​ 87.2 ​ (33,388) 65.9 Product development expenses (2,865) ​ 19.0 ​ (3,088) ​ 11.4 ​ (3,571) 7.0 General and administrative expenses (8,068) ​ 53.6 ​ (7,727) ​ 28.5 ​ (10,615) 20.9 Loss from operations (12,358) ​ 82.1 ​ (13,663) ​ 50.4 ​ (8,046) 15.9 Interest income 27 ​ 0.2 ​ 165 ​ 0.6 ​ 229 0.5 Other (expenses)/income, net (453) ​ 3.0 ​ (1,416) ​ 5.2 ​ 771 1.5 Loss before income tax (12,784) ​ 85.0 ​ (14,914) ​ 55.0 ​ (7,046) 13.9 Income tax expenses (60) ​ 0.4 ​ (118) ​ 0.4 ​ (276) 0.5 Net loss from continuing operations, net of income tax ​ (12,844) ​ 85.4 ​ (15,032) ​ 55.4 ​ (7,322) ​ 14.4 Net loss from discontinued operations, net of income tax ​ (29,712) ​ — ​ — ​ — ​ — ​ — Net loss ​ (42,556) ​ — ​ (15,032) ​ — ​ (7,322) ​ — Net loss attributable to noncontrolling interests ​ — ​ — ​ — ​ — ​ (87) ​ — Net loss, all attributable to the Company’s ordinary shareholders (42,556) ​ — ​ (15,032) ​ — ​ (7,235) — ​ ​ 85 Table of Contents The Year Ended December 31, 2024 Compared to the Year Ended December 31, 2023 Net Revenues Our net revenues from our international business operations increased by 87% from US$27.1 million in 2023 to US$50.7 million in 2024.
The operating results in any period are not necessarily indicative of the results that may be expected for any future period. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2023 ​ 2024 ​ 2025 ​ ​ ​ ​ US$ ​ ​ ​ % ​ ​ ​ US$ ​ ​ ​ % ​ ​ ​ US$ ​ ​ ​ % ​ ​ (in thousands, except for percentages) Net revenues 27,111 ​ 100.0 ​ 50,692 ​ 100.0 ​ 95,601 100.0 Cost of revenues (6,322) ​ 23.3 ​ (11,164) ​ 22.0 ​ (24,944) 26.1 Gross profit 20,789 ​ 76.7 ​ 39,528 ​ 78.0 ​ 70,657 73.9 Operating expenses ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Sales and marketing expenses (23,637) ​ 87.2 ​ (33,388) ​ 65.9 ​ (62,307) 65.2 Product development expenses (3,088) ​ 11.4 ​ (3,571) ​ 7.0 ​ (5,476) 5.7 General and administrative expenses (7,727) ​ 28.5 ​ (10,615) ​ 20.9 ​ (17,303) 18.1 Loss from operations (13,663) ​ 50.4 ​ (8,046) ​ 15.9 ​ (14,429) 15.1 Interest income 165 ​ 0.6 ​ 229 ​ 0.5 ​ 358 0.4 Other (expenses)/income, net (1,416) ​ 5.2 ​ 771 ​ 1.5 ​ (1,545) 1.6 Loss before income tax (14,914) ​ 55.0 ​ (7,046) ​ 13.9 ​ (15,616) 16.3 Income tax expenses (118) ​ 0.4 ​ (276) ​ 0.5 ​ (1,242) 1.3 Net loss ​ (15,032) ​ 55.4 ​ (7,322) ​ 14.4 ​ (16,858) ​ 17.6 Less: net loss attributable to noncontrolling interests ​ — ​ — ​ (87) ​ — ​ (54) ​ — Net loss, all attributable to the Company’s ordinary shareholders (15,032) ​ — ​ (7,235) ​ — ​ (16,804) — ​ The Year Ended December 31, 2025 Compared to the Year Ended December 31, 2024 Net Revenues Our net revenues from our international business operations increased by 88.6% from US$50.7 million in 2024 to US$95.6 million in 2025.
PRC Our subsidiary and the former consolidated VIEs in mainland China are companies incorporated under PRC law and, as such, are subject to mainland China enterprise income tax on their taxable income in accordance with the PRC income tax laws.
The income tax rate is 20% on taxable profits. ​ 70 Table of Contents PRC Our subsidiary in mainland China are companies incorporated under PRC law and, as such, are subject to mainland China enterprise income tax on their taxable income in accordance with the PRC income tax laws.
Our CRM software manages student information from leads generation through every step of our sales efforts, as well as tracks student feedback and performance on our platform throughout their entire learning experience.
We have also developed our proprietary CRM software to organize and manage every aspect of our students’ engagement with our platform. Our CRM software manages student information from leads generation through every step of our sales efforts, as well as tracks student feedback and performance on our platform throughout their entire learning experience.
The following table sets forth, for the years indicated, our operating expenses, in absolute amounts and as percentages of total net revenues: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2022 ​ ​ ​ 2023 ​ ​ ​ 2024 ​ ​ ​ US$ % US$ % US$ % ​ ​ (in thousands, except for percentages) Operating expenses: ​ Sales and marketing 13,279 ​ 88.2 % 23,637 ​ 87.2 % 33,388 65.9 % General and administrative 8,068 ​ 53.6 % 7,727 ​ 28.5 % 10,615 20.9 % Product development 2,865 ​ 19.0 % 3,088 ​ 11.4 % 3,571 7.0 % Total operating expenses 24,212 160.8 % 34,452 ​ 127.1 % 47,574 93.8 % ​ Our sales and marketing expenses primarily consist of payroll and employee benefits to our sales and marketing personnel, online and mobile marketing expenses, branding expenses, free trial lesson - related expenses.
The following table sets forth, for the years indicated, our operating expenses, in absolute amounts and as percentages of total net revenues: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2023 ​ ​ ​ 2024 ​ ​ ​ 2025 ​ ​ ​ ​ ​ ​ US$ ​ ​ ​ % ​ ​ ​ US$ ​ ​ ​ % ​ ​ ​ US$ ​ ​ ​ % ​ ​ (in thousands, except for percentages) Operating expenses: ​ ​ ​ ​ ​ ​ ​ Sales and marketing 23,637 ​ 87.2 % 33,388 ​ 65.9 % 62,307 65.2 % General and administrative 7,727 ​ 28.5 % 10,615 ​ 20.9 % 17,303 18.1 % Product development 3,088 ​ 11.4 % 3,571 ​ 7.0 % 5,476 5.7 % Total operating expenses 34,452 127.1 % 47,574 ​ 93.8 % 85,086 89.0 % ​ Our sales and marketing expenses primarily consist of our sales and marketing personnel related expenses and marketing and branding expenses.
As of December 31, 2024, we and our subsidiaries held cash, cash equivalents and time deposits in the amount of US$14.5 million, SAR19.4 million, SGD3.4 million, MYR5.6 million, HKD6.7 million, RMB16.1 million and THB57.2 million in bank accounts in mainland China, Saudi Arabia, Singapore, Malaysia, Hong Kong and Thailand, and our consolidated entities in mainland China held cash, cash equivalents in the amount of US$1.0 million in mainland China, which included cash reserved to settle payables to our mainland China subsidiaries.
As of December 31, 2025, we and our subsidiaries held cash, cash equivalents and time deposits in the amount of US$13.6 million, SAR57.5 million, SGD0.4 million, MYR2.5 million, HKD21.2 million, RMB19.3 million and THB60.7 million in bank accounts in mainland China, Saudi Arabia, Singapore, Malaysia, Hong Kong and Thailand, and our consolidated entities in mainland China held cash, cash equivalents in the amount of US$2.4 million in mainland China, which included cash reserved to settle payables to our mainland China subsidiaries.
We define gross billings for a specific period as the total amount of cash received and receivable from third party payment platforms for the sale of course packages and services in such period, net of the total amount of refunds in such period.
We define gross billings for a specific period as the total amount of cash received and receivable from third party payment platforms for the sale of course packages and services in such period, net of the total amount of refunds in such period. Our net losses in 2023, 2024 and 2025 were US$15.0 million, US$7.3 million and US$16.9 million, respectively.
Saudi Arabia Our subsidiary in Saudi Arabia, Darb Al - Najah Training Company, was incorporated in 2023. The income is subject to Saudi tax laws. The income tax rate is 20% on taxable profits. 83 Table of Contents United Arab Emirates Our subsidiaries in United Arab Emirates, HAWO EDUCATION INVESTMENT-FZCO and Hawo Online Training L.L.C-FZ were incorporated in 2024.
United Arab Emirates Our subsidiaries in United Arab Emirates, HAWO EDUCATION INVESTMENT-FZCO and Hawo Online Training L.L.C-FZ were incorporated in 2024. The income is subject to United Arab Emirates tax laws. The income tax rate is 9% on taxable profits.
The increase was primarily attributable to the increase in the number of paid lessons booked driven by the increase in the number of active students of our international business. The number of active students with general lesson consumption increased by 96.5% from 26.4 thousand in 2022 to 51.9 thousand in 2023.
The increase was primarily attributable to the increase in the number of paid lessons booked driven by the increase in the number of active students of our international business. The number of active students with general lesson consumption increased by 81.2% from 97.5 thousand in 2024 to 176.7 thousand in 2025.
Financing Activities Net cash provided by financing activities from international business operations in 2024 amounted to US$0.2 million, which was mainly due to capital injection from noncontrolling interests. Net cash used in financing activities from international business operations in 2023 and 2022 amounted to nil.
Financing Activities Net cash provided by financing activities from international business operations in 2025 amounted to US$0.2 million, which was mainly due to proceeds from exercise of stock options. 75 Table of Contents Net cash provided by financing activities from international business operations in 2024 amounted to US$0.2 million, which was mainly due to capital injection from noncontrolling interests.
Each step of our tutors’ interaction with our platform, from initial engagement, to interviews, orientation, teacher training, evaluation and promotion, is systematically managed and processed by our ERP system. We have also developed our proprietary CRM software to organize and manage every aspect of our students’ engagement with our platform.
Proprietary CRM and ERP systems We developed our proprietary ERP system to manage and integrate our key administrative and operational functions, especially those related to our tutors. Each step of our tutors’ interaction with our platform, from initial engagement, to interviews, orientation, teacher training, evaluation and promotion, is systematically managed and processed by our ERP system.
Our IT department regularly monitors the performance of our websites, mobile apps and technology infrastructure to enable us to respond quickly to potential problems.
We back up our databases daily. Our IT department regularly monitors the performance of our websites, mobile apps and technology infrastructure to enable us to respond quickly to potential problems. We have not experienced any major problems in our network infrastructure.
In addition, offshore subsidiaries of 51Talk Online Education Group pay service fees to certain mainland China subsidiary of 51Talk Online Education Group pursuant to operating management service agreements, marketing service agreements and research and development service agreements.
In addition, subsidiaries of 51Talk Online Education Group pay service fees to certain mainland China subsidiary of 51Talk Online Education Group pursuant to operating management service agreements, marketing service agreements and research and development service agreements. To effectively manage cash flow within our organization, we have put in place relevant cash management policies.
Since Philippines Co III are not within any special economic zone territory, Philippines Co III is subject to a corporate income tax of 20% of the taxable net income on all income derived during each taxable year from sources within and outside of the Philippines.
Philippines Co III is subject to a corporate income tax of 20% of the taxable net income on all income derived during each taxable year from sources within and outside of the Philippines. In addition to the corporate income tax, these two subsidiaries are also subject to 12% of Value Added Tax on all income generated within the Philippines.
The increase was mainly due to the increases in sales and marketing expenses and product development expenses. Sales and Marketing Expenses Our sales and marketing expenses from our international business operations increased by 78.0% from US$13.3 million in 2022 to US$23.6 million in 2023.
Operating Expenses Our operating expenses from our international business operations increased by 78.8% from US$47.6 million in 2024 to US$85.1 million in 2025. The increase was mainly due to the increases in sales and marketing expenses.
As of December 31, 2024, we held sixteen registered domain names relating to our business, five registered software copyrights and four trademarks in several jurisdictions. D.
As of December 31, 2025, we held eighteen registered domain names relating to our business, nine registered software copyrights and five trademark designs, which were registered and recognized in several jurisdictions as per applicable laws in several jurisdictions. D.
Risk Factors—Risks Related to Our Global Operations—Our mainland China subsidiaries are subject to restrictions on paying dividends or making other payments to us, which may restrict our ability to satisfy our liquidity requirements.” ​ 89 Table of Contents In addition, under laws and regulations of mainland China, our mainland China subsidiaries are subject to restrictions on foreign exchange and cross-border cash transfers, including to our holding company 51Talk Online Education Group and to U.S. investors.
In addition, under laws and regulations of mainland China, our mainland China subsidiaries are subject to restrictions on foreign exchange and cross-border cash transfers, including to our holding company 51Talk Online Education Group and to U.S. investors.
Our general and administrative expenses primarily consist of payroll and employee benefits to our management and administrative personnel. Our general and administrative expenses also include rental and utilities expenses relating to office and administrative functions as well as professional service fees.
Our general and administrative expenses primarily consist of our management and administrative personnel related expenses. Our general and administrative expenses also include professional service fees as well as share -based compensation expenses.
Net cash used in investing activities from international business operations amounted to US$7.6 million in 2022, which was primarily attributable to the repayment of investment to discontinued operations and partially offset by withdrawal of time deposits.
Investing Activities Net cash used in investing activities from international business operations amounted to US$1.0 million in 2025, which was primarily attributable to purchase of PPE and netted off by withdrawal of deposits. Net cash provided by investing activities from international business operations amounted to US$0.5 million in 2024, which was primarily attributable to withdrawal of time deposits.
Cost of Revenues Our cost of revenues from our international business operations increased by 97.9% from US$3.2 million in 2022 to US$6.3 million in 2023. The increase was primarily due to the increase in total service fees paid to tutors, which was mainly resulting from the delivery of an increased number of paid lessons.
The increase was primarily due to the increase in total service fees paid to tutors, which was mainly resulting from an increased number of paid lessons. The total amount of service fees paid to tutors for delivering paid lessons increased by 101.2% from US$8.9 million in 2024 to US$18.0 million in 2025.
In addition to the corporate income tax, these two companies are also subject to 12% of Value Added Tax on all income generated within the Philippines. Prior to the Ease of Paying Taxes Act (Republic Act No. 11976), which took effect on January 22, 2024, the VAT on services was based on gross receipts.
Prior to the Ease of Paying Taxes Act (Republic Act No. 11976), which took effect on January 22, 2024, the VAT on services was based on gross receipts. Payments of dividends by Philippines Co II and Philippines Co III are subject to withholding tax in the Philippines at the rate of 25%.
Risk Factors—Risks Related to Our Global Operations—PRC regulations relating to foreign exchange registration of international investment by mainland China residents may subject our mainland China resident beneficial owners or our mainland China subsidiaries to liability or penalties, limit our ability to inject capital into these subsidiaries, limit mainland China subsidiaries’ ability to increase their registered capital or distribute profits to us, or may otherwise adversely affect us.” To the extent cash or other assets in the business is in mainland China or a mainland China entity, the funds or other assets may not be available to fund operations or for other use outside of mainland China due to the imposition of restrictions and limitations by the PRC government on the ability of 51Talk Online Education Group or its subsidiaries to transfer cash or other assets.
To the extent cash or other assets in the business is in mainland China or a mainland China entity, the funds or other assets may not be available to fund operations or for other use outside of mainland China due to the imposition of restrictions and limitations by the PRC government on the ability of 51Talk Online Education Group or its subsidiaries to transfer cash or other assets.
Our new business offerings focus on one-on-one English lessons taught by foreign tutors to students in countries and regions outside of mainland China.
Our new business offerings focus on one-on-one English lessons taught by foreign tutors to students in countries and regions outside of mainland China. Our historical operational and financial data is not indicative of future operational and financial performances, particularly due to the transition described above. Our reporting currency is United States dollars.
See “Forward-Looking Information.” In evaluating our business, you should carefully consider the information provided under the caption “Item 3. Key Information—D. Risk Factors” in this annual report on Form 20-F. All the operational risks associated with having operations in mainland China also apply to operations in Hong Kong.
See “Forward-Looking Information.” In evaluating our business, you should carefully consider the information provided under the caption “Item 3. Key Information—D. Risk Factors” in this annual report on Form 20-F. A. Operating Results Overview We are a global online education platform with core expertise in English education. Our mission is to make quality education accessible and affordable.
The increase was primarily due to the increase in headcount and personnel - related expenses and the increase in advertising and promotion fees for our international business. General and Administrative Expenses Our general and administrative expenses from our international business operations decreased by 4.2% from US$8.1 million in 2022 to US$7.7 million in 2023.
General and Administrative Expenses Our general and administrative expenses from our international business operations increased by 63.0% from US$10.6 million in 2024 to US$17.3 million in 2025. This increase was primarily due to the increase in headcount and personnel-related expenses.
There is no assurance that the ability of us, our subsidiaries and the former mainland China consolidated VIEs to transfer cash will not subject to further limitations or restrictions imposed by the PRC government.
There is no assurance that the ability of us or our subsidiaries to transfer cash will not subject to further limitations or restrictions imposed by the PRC government. Our subsidiaries did not make cash dividends or other distributions to 51Talk Online Education Group, the holding company, or its offshore subsidiaries, in the years ended December 31, 2023, 2024 and 2025.
As of December 31, 2023 and 2024, we had only one reportable segment, namely the international business segment. Selected Income Statement Items Net Revenues In 2022, 2023 and 2024, we generated net revenues from continuing operations of US$15.0 million, US$27.1 million and US$50.7 million, respectively. We generally collect fees in advance, which we initially record as advances from students.
Selected Income Statement Items Net Revenues In 2023, 2024 and 2025, we generated net revenues of US$27.1 million, US$50.7 million and US$95.6 million, respectively. We generally collect fees in advance, which we initially record as advances from students. We mainly offer prepaid credit packages with minimum monthly consumption for our students to purchase.
Capital Expenditures Our capital expenditures are incurred primarily in connection with leasehold improvements and investments in office furniture, computers and servers. Our capital expenditures from our international business were US$0.01 million, US$0.3 million and US$0.3 million in the years ended December 31, 2022, 2023 and 2024, respectively.
Net cash used in financing activities from international business operations in 2023 amounted to nil. Capital Expenditures Our capital expenditures are incurred primarily in connection with leasehold improvements and investments in office furniture, computers and servers.
The increase was primarily due to an increase in the number of technology and course development - related personnel in the international business. Other expenses, net Our other expenses from our international business operations increased from US$0.5 million in 2022 to US$1.4 million in 2023. The increase was mainly due to the provision for interests and penalties of taxes.
Other income / (expenses), net We recorded other income, net from our international business operations of US$0.8 million in 2024 and other expense, net of US$1.5 million in 2025. The other income, net in 2024 mainly include the reversal of the provision for interests and penalties of the taxes that were recognized in 2023.
Income Tax Expenses We recorded income tax expenses from our international business operations of US$0.1 million in 2022 and US$0.1 million in 2023, respectively. Net loss from continuing operations As a result of the foregoing, we incurred net loss from our international business operations of US$12.8 million and US$15.0 million in 2022 and 2023, respectively.
The other expense, net in 2025 mainly include foreign exchange losses. Income Tax Expenses We recorded income tax expenses from our international business operations of US$0.3 million in 2024 and US$1.2 million in 2025, respectively.
The Year Ended December 31, 2023 Compared to the Year Ended December 31, 2022 Net Revenues Our net revenues from our international business operations increased by 80.2% from US$15.0 million in 2022 to US$27.1 million in 2023.
Net loss As a result of the foregoing, we incurred net loss from our international business operations of US$7.3 million and US$16.9 million in 2024 and 2025, respectively. 72 Table of Contents The Year Ended December 31, 2024 Compared to the Year Ended December 31, 2023 Net Revenues Our net revenues from our international business operations increased by 87% from US$27.1 million in 2023 to US$50.7 million in 2024.
The number of active students is the main driver for our revenue. We track the number of active students as a key indicator for our business growth and manage our course offerings and sales strategies accordingly.
We track the number of active students as a key indicator for our business growth and manage our course offerings and sales strategies accordingly. 71 Table of Contents Cost of Revenues Our cost of revenues from our international business operations increased by 123.4% from US$11.2 million in 2024 to US$24.9 million in 2025.
Specifically, net loss of US$29.7 million in 2022 has been excluded from our financial results from international business and have been separately reclassified to the divested China Mainland Business. ​ Results of Operations The following table sets forth a summary of our consolidated results of operations for the years indicated, both in absolute amounts and as percentages of our net revenues.
Our subsidiaries in mainland China are also subject to surcharges on value-added tax payments in accordance with PRC law. Results of Operations The following table sets forth a summary of our consolidated results of operations for the years indicated, both in absolute amounts and as percentages of our net revenues.
We intend to continue to utilize real estate leasing in order to allocate our capital resources cost - efficiently.
Our capital expenditures from our international business were US$0.3 million, US$0.3 million and US$2.3 million in the years ended December 31, 2023, 2024 and 2025, respectively. We intend to continue to utilize real estate leasing in order to allocate our capital resources cost - efficiently.
In addition, payments of dividends by our subsidiaries incorporated in Hong Kong to us are not subject to withholding tax in Hong Kong. Philippines Philippines Co II has been registered with the Philippine Economic Zone Authority, or PEZA, as an Ecozone IT Enterprise since December 19, 2014.
In addition, payments of dividends by our subsidiaries incorporated in Hong Kong to us are not subject to withholding tax in Hong Kong. Philippines Philippines Co II was incorporated in the Philippines and subjected to corporate income tax in the Philippines at a rate of 25%.
The taxable income generated by the company should be subjected to 15% for the first MYR150 taxable income, 17% on the next MYR450, and 24% thereafter. Thailand Our subsidiary in Thailand, Helloworld Education Online (Thailand) Co., Ltd., was incorporated in 2023. The income is subject to Thailand tax laws. The income tax rate is 20% on taxable profits.
The income is subject to Thailand tax laws. The income tax rate is 20% on taxable profits. Saudi Arabia Our subsidiary in Saudi Arabia, Darb Al - Najah Training Company, was incorporated in 2023. The income is subject to Saudi Arabia tax laws. The income tax rate is 20% on taxable profits.
This decrease was primarily due to the reduction in consulting and audit fees. 87 Table of Contents Product Development Expenses Our product development expenses from our international business operations increased by 7.8% from US$2.9 million in 2022 to US$3.1 million in 2023.
Product Development Expenses Our product development expenses from our international business operations increased by 53.3% from US$3.6 million in 2024 to US$5.5 million in 2025. The increase was primarily due to the increase in headcount and personnel-related expenses.
The total amount of service fees paid to tutors for delivering paid lessons increased by 85.7% from US$2.8 million in 2022 to US$5.2 million in 2023. Gross Profit As a result of the foregoing, our gross profit from our international business operations was US$11.9 million in 2022 and US$21.0 million in 2023.
Gross Profit As a result of the foregoing, our gross profit from our international business operations was US$39.5 million in 2024 and US$70.7 million in 2025. Our gross margin decreased from 78.0% in 2024 to 73.9% in 2025. The decrease was mainly attributable to the increased payment processing fee due to the larger gross billings.
The income is subject to United Arab Emirates laws. The income tax rate is 9% on taxable profits.
Vietnam Our subsidiary, Helloworld Online Education Vietnam Company Limited, is established in Vietnam in July, 2025 and is subject to Vietnam tax laws. The income tax rate is 20% on taxable profits. Jordan Our subsidiary, HelloWorld Online Education Jordan LLC, is established in Jordan and is subject to Jordan tax laws.
Removed
With respect to the legal risks associated with having operations in mainland China, the laws, regulations and the discretion of mainland China governmental authorities discussed in this annual report are expected to apply to mainland China entities and operations, rather than entities or operations in Hong Kong which operate under a different set of laws from mainland China.
Added
Under the prevailing Malaysian tax law (Income Tax Act 1967 and Budget 2024 provisions), the taxable income generated by the company should be subjected to 15% for the first MYR0.15 million taxable income, 17% for taxable income between MYR0.15 million to MYR0.6 million, and 24% thereafter, while it qualifies as a resident small or medium-sized enterprise (SME).
Removed
We caution you that our businesses and financial performance are subject to substantial risks and uncertainties. A. Operating Results Overview We are a global online education platform with core expertise in English education. Our mission is to make quality education accessible and affordable.
Added
Non-SME resident companies are subject to a uniform 24% corporate income tax rate. The subsidiary was a SME for the year ended December 31, 2023 and became a non-SME for the years ended December 31, 2024 and 2025. 69 Table of Contents Thailand Our subsidiary in Thailand, Helloworld Education Online (Thailand) Co., Ltd., was incorporated in 2022.
Removed
Our historical operational and financial data is not indicative of future operational and financial performances, particularly due to the transition described above. 81 Table of Contents Historically, a significant majority of our revenue was generated from our China Mainland Business, which was operated by the subsidiaries and VIEs controlled by China Online Education (HK) limited, which was in turn our wholly owned subsidiary before June 30, 2022.
Added
As of December 31, 2023, 2024 and 2025, we did not record any withholding tax on the retained earnings of the two subsidiaries in the Philippines on the basis of our current intent to permanently reinvest the undistributed earnings.
Removed
We entered into a definitive share purchase agreement, dated June 24, 2022, with Dasheng Holding (HK) Limited, an entity controlled by Mr. Jiajia Jack Huang, our chairman of the board of directors and chief executive officer, pursuant to which Mr.
Added
The number of active students is the main driver for our revenue.
Removed
Jiajia Jack Huang, through Dasheng, acquired all of our company’s online English tutoring businesses in mainland China, including all associated liabilities and assets, for US$1. On June 30, 2022, we completed the divestiture of the China Mainland Business.
Added
Sales and Marketing Expenses Our sales and marketing expenses from our international business operations increased by 86.6% from US$33.4 million in 2024 to US$62.3 million in 2025. The increase in headcount and personnel-related expenses, and the increase in marketing and branding expenses resulting from intensified marketing and branding activities.
Removed
After the divestiture, our company focuses on providing online English tutoring lessons taught by foreign tutors to K - 12 and post - secondary students in countries and regions outside of mainland China, meanwhile, China Online Education (HK) limited and its subsidiaries ceased to be our subsidiaries and the VIEs in mainland China were divested along with such divestiture or subsequently dissolved.
Added
Going forward, our subsidiaries intend to retain most, if not all, of their available funds and any future earnings. 74 Table of Contents Our principal sources of liquidity have been proceeds from our equity offerings and cash generated from operating activities. As of December 31, 2025, we had US$39.0 million in cash, cash equivalents, and time deposits.
Removed
Effective January 1, 2022, we elected to change our reporting currency from RMB to USD.
Added
Cash and cash equivalent consists of cash held in demand deposit accounts managed by financial institutions, which have original maturities of less than three months and unrestricted as to withdrawal and use.
Removed
Our net losses from continuing operations in 2022 was US$12.8 million, and our net losses in 2023 and 2024 was US$15.0 million and US$7.3 million, respectively.
Added
We believe the following accounting estimate involve the most significant judgments used in the preparation of our financial statements. Determination of Standalone Selling Price of Performance Obligations We provide two kinds of lessons as distinct performance obligations in one contract: one-on-one private course service and public course service.
Removed
Change in Segment Reporting Upon the divestiture of the China Mainland Business on June 30, 2022, the chief operating decision maker no longer reviews the China Mainland Business, as a result, we reevaluated our segments and now have classified the China Mainland Business as discontinued operations.
Added
We did not sell them separately on stand-alone basis, therefore judgment is required to determine standalone selling price for each distinct performance obligation. We determine the stand-alone selling prices using an expected cost plus margin methodology for private courses and the adjusted market assessment methodology for public courses.

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Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

53 edited+9 added−8 removed64 unchanged
Huang and Ms. Shu. Mr. Huang, Ms. Shu and their family members are beneficiaries under TB Family Trust. The settlor of HH Talent Trust is Mr.
Huang and Ms. Shu. Mr. Huang, Ms. Shu and their family members are beneficiaries under TB Family Trust. The settlor of HH Talent Trust is Mr. Huang.
Except otherwise provided in the Award Agreement or other written agreement entered into by and between the company and a participant of the 2016 Plan, if a corporate transaction occurs, the plan administrator may, in its sole discretion, provide for (i) any and all awards outstanding to terminate at a specific time in the future and give each participant the right to exercise the vested portion of such awards during a specific period of time as the plan administrator shall determine, or (ii) the purchase of any award for an amount of cash equal to the amount that could have been attained upon the exercise of such award, or (iii) the replacement of such award with other rights or property selected by the plan administrator in its sole discretion or the assumption of or substitution of such award by the successor or surviving corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of Class A ordinary shares and prices, or (iv) payment of award in cash based on the value of Class A ordinary shares on the date of the corporate transaction plus reasonable interest.
Except otherwise provided in the Award Agreement or other written agreement entered into by and between the company and a participant of the Amended and Restated 2016 Plan, if a corporate transaction occurs, the plan administrator may, in its sole discretion, provide for (i) any and all awards outstanding to terminate at a specific time in the future and give each participant the right to exercise the vested portion of such awards during a specific period of time as the plan administrator shall determine, or (ii) the purchase of any award for an amount of cash equal to the amount that could have been attained upon the exercise of such award, or (iii) the replacement of such award with other rights or property selected by the plan administrator in its sole discretion or the assumption of or substitution of such award by the successor or surviving corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of Class A ordinary shares and prices, or (iv) payment of award in cash based on the value of Class A ordinary shares on the date of the corporate transaction plus reasonable interest.
The audit committee is responsible for, among other things: ● selecting the independent registered public accounting firm and pre-approving all auditing and non-auditing services permitted to be performed by the independent registered public accounting firm; ● reviewing with the independent registered public accounting firm any audit problems or difficulties and management’s response; ​ 100 Table of Contents ● reviewing and approving all proposed related party transactions, as defined in Item 404 of Regulation S-K under the Securities Act; ● discussing the annual audited financial statements with management and the independent registered public accounting firm; ● reviewing the adequacy and effectiveness of our accounting and internal control policies and procedures and any special steps taken to monitor and control major financial risk exposures; ● annually reviewing and reassessing the adequacy of our audit committee charter; ● meeting separately and periodically with management and the independent registered public accounting firm; ● monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance; and ● reporting regularly to the board.
The audit committee is responsible for, among other things: ● selecting the independent registered public accounting firm and pre-approving all auditing and non-auditing services permitted to be performed by the independent registered public accounting firm; ● reviewing with the independent registered public accounting firm any audit problems or difficulties and management’s response; ● reviewing and approving all proposed related party transactions, as defined in Item 404 of Regulation S-K under the Securities Act; ● discussing the annual audited financial statements with management and the independent registered public accounting firm; ● reviewing the adequacy and effectiveness of our accounting and internal control policies and procedures and any special steps taken to monitor and control major financial risk exposures; 83 Table of Contents ● annually reviewing and reassessing the adequacy of our audit committee charter; ● meeting separately and periodically with management and the independent registered public accounting firm; ● monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance; and ● reporting regularly to the board.
(7) Consists of 18,967,560 Class A ordinary shares in the form of ADSs held by Golien Ltd, as reported in a Schedule 13G filed by Golien Ltd, on February 7, 2023. The registered address of Golien Ltd is Suite 1104-06, 11 F, Tower 2, The Gateway, Tsimshatsui, Kowloon, Hong Kong.
(8) Consists of 18,967,560 Class A ordinary shares in the form of ADSs held by Golien Ltd, as reported in a Schedule 13G filed by Golien Ltd, on February 7, 2023. The registered address of Golien Ltd is Suite 1104-06, 11 F, Tower 2, The Gateway, Tsimshatsui, Kowloon, Hong Kong.
The term of each award is stated in the relevant award agreement. The specified term of any award will not include any period for which the grantee has elected to defer the receipt of the shares or cash issuable pursuant to the award. Transfer Restrictions .
Terms of Award . The term of each award is stated in the relevant award agreement. The specified term of any award will not include any period for which the grantee has elected to defer the receipt of the shares or cash issuable pursuant to the award. Transfer Restrictions .
Each of Golien Ltd and wm100 holding Ltd as the parent of Golien Ltd, has the sole power to direct the voting and disposition of the ADSs held by Golien Ltd. As the shareholders of wm100 holding Ltd, Max Burger and Beat Stefan Burger have joint power to direct the voting and disposition of the ADSs held by Golien SPC.
Each of Golien Ltd and wm100 holding Ltd as the parent of Golien Ltd, has the sole power to direct the voting and disposition of the ADSs held by Golien Ltd. As the shareholders of wm100 holding Ltd, Max Burger and Beat Stefan Burger have joint power to direct the voting and disposition of the ADSs held by Golien Ltd.
Bonner are the directors of each of Hybrid Fund UGP and Turbo Fund UGP and may be deemed to have shared power to dispose of these shares. The business address of Hybrid Fund, Turbo Fund and Turbo Affiliates Fund is 2420 Sand Hill Road, Suite 200, Menlo Park, CA 94025, the United States.
Levi are the directors of each of Hybrid Fund UGP and Turbo Fund UGP and may be deemed to have shared power to dispose of these shares. The business address of Hybrid Fund, Turbo Fund and Turbo Affiliates Fund is 2420 Sand Hill Road, Suite 200, Menlo Park, CA 94025, the United States.
The 2016 Plan permits the awards of options, restricted shares and restricted share units. Plan Administration . Our board or a committee of one or more members of our board duly authorized for the purpose of the 2016 Plan can act as the plan administrator. Award Agreement .
The Amended and Restated 2016 Plan permits the awards of options, restricted shares and restricted share units. Plan Administration . Our board or a committee of one or more members of our board duly authorized for the purpose of the Amended and Restated 2016 Plan can act as the plan administrator. Award Agreement .
Lin currently serves on the board of directors of various DCM portfolio companies, including Tuniu Corporation and QuantaSing Group Limited, which are Nasdaq - listed companies, and Vipshop Holdings Limited, an NYSE - listed company. Mr. Lin received an MBA degree from Stanford University and a bachelor’s degree in engineering from Dartmouth College. ​ 95 Table of Contents Mr.
Lin currently serves on the board of directors of various DCM portfolio companies, including Tuniu Corporation and QuantaSing Group Limited, which are Nasdaq - listed companies, and Vipshop Holdings Limited, an NYSE - listed company. Mr. Lin received an MBA degree from Stanford University and a bachelor’s degree in engineering from Dartmouth College. Mr.
The board of directors or any entity appointed by the board to administrate the Pre-IPO Plans determines the provisions, terms, and conditions of each award including, but not limited to, the award vesting schedule, repurchase provisions, rights of first refusal, forfeiture provisions, form of payment (cash, shares, or other consideration) upon settlement of the award and payment contingencies. 97 Table of Contents Terms of Award .
The board of directors or any entity appointed by the board to administrate the Pre-IPO Plans determines the provisions, terms, and conditions of each award including, but not limited to, the award vesting schedule, repurchase provisions, rights of first refusal, forfeiture provisions, form of payment (cash, shares, or other consideration) upon settlement of the award and payment contingencies.
Wu currently serves on the board of directors of LexinFintech Holdings Ltd., a Nasdaq - listed company, and Hiaidilao International Holding Ltd., a Hong Kong Stock Exchange listed company and a Nasdaq - listed company. Mr.
Wu currently serves on the board of directors of LexinFintech Holdings Ltd., a Nasdaq - listed company, and Haidilao International Holding Ltd., a Hong Kong Stock Exchange listed company and a Nasdaq - listed company. Mr.
Shu co-founded Talk China with Mr. Jack Jiajia Huang in 2007. Ms. Shu received her master’s degree in language science from the University of Tokyo in 2010 and her bachelor’s degree in Japanese language from Tsinghua University in 2007. Mr. Jack Jiajia Huang and Ms. Ting Shu are husband and wife. Ms.
Shu co-founded Talk China with Mr. Jack Jiajia Huang in 2007. Ms. Shu received her master’s degree in language science from the University of Tokyo in 2010 and her bachelor’s degree in Japanese language from Tsinghua University in 2007. Mr. Jack Jiajia Huang and Ms. Ting Shu are husband and wife. 78 Table of Contents Ms.
In addition to our full - time employees, some of our subsidiaries, such as Beijing Helloworld Online Technology Co., Ltd. and HelloWorld Online Education PTE. LTD, entered into services outsource agreements with independent third - party suppliers in 2023 and 2024, through which they have outsourced part of their marketing and sales functions.
In addition to our full - time employees, some of our subsidiaries, such as Beijing Helloworld Online Technology Co., Ltd., HelloWorld Online Education Group (HK) Limited and HelloWorld Online Education Pte. Ltd., entered into services outsource agreements with independent third - party suppliers in 2023, 2024 and 2025, through which they have outsourced part of their marketing and sales functions.
The Pre-IPO Plans permit the awards of options, share appreciation rights, dividend equivalent rights, restricted shares, restricted share units and other rights or benefits under the Pre-IPO Plans. Plan Administration . Our board of directors administers the Pre-IPO Plans.
The Pre-IPO Plans permit the awards of options, share appreciation rights, dividend equivalent rights, restricted shares, restricted share units and other rights or benefits under the Pre-IPO Plans. 80 Table of Contents Plan Administration . Our board of directors administers the Pre-IPO Plans.
(3) The business address of Frank Lin is 2420 Sand Hill Road, Suite 200, Menlo Park, CA 94025, United States. (4) The business address of Xiaoguang Wu is Suite 2501, Shenzhen Venture Capital Mansion, Nanshan District, Shenzhen, Guangdong Province, People’s Republic of China.
(3) The business address of Frank Lin (also known as Frank Hurst Lin) is 2420 Sand Hill Road, Suite 200, Menlo Park, CA 94025, United States. (4) The business address of Xiaoguang Wu is Suite 2501, Shenzhen Venture Capital Mansion, Nanshan District, Shenzhen, Guangdong Province, People’s Republic of China.
As of December 31, 2024, we had 492 outsourced personnel mainly performing sales and marketing functions for us. We enter into employment contracts with our full-time employees. For our full-time employees in countries and regions outside mainland China, the employment contracts we have with them contain confidentiality and non-compete provisions.
As of December 31, 2025, we had 1,359 outsourced personnel mainly performing sales and marketing functions for us. We enter into employment contracts with our full-time employees. For our full-time employees in countries and regions outside mainland China, the employment contracts we have with them contain confidentiality and non-compete provisions.
Wu received his EMBA from China Europe International Business School (CEIBS) in 2008 and his bachelor of science degree in weather dynamics from Nanjing University in 1996. B. Compensation For the fiscal year ended December 31, 2024, we paid an aggregate of approximately US$387.1 thousand in cash to our executive officers and our non - executive directors.
Wu received his EMBA from China Europe International Business School (CEIBS) in 2008 and his bachelor of science degree in weather dynamics from Nanjing University in 1996. B. Compensation For the fiscal year ended December 31, 2025, we paid an aggregate of approximately US$519.4 thousand in cash to our executive officers and our non - executive directors.
(5) Consists of (i) 57,681,212 Class B ordinary shares held by DCM Hybrid RMB Fund, L.P., or Hybrid Fund; (ii) 10,017,832 Class A ordinary shares held by DCM Ventures China Turbo Fund, L.P., or Turbo Fund, and (iii) 589,278 Class A ordinary shares held by DCM Ventures China Turbo Affiliates Fund, L.P., or Turbo Affiliates Fund, as reported in a Schedule 13D amendment jointly filed by, among others, Hybrid Fund, Turbo Fund and Turbo Affiliates Fund, on January 26, 2023.
(5) Consists of (i) 57,681,212 Class B ordinary shares held by DCM Hybrid RMB Fund, L.P., or Hybrid Fund; (ii) 10,017,832 Class A ordinary shares held by DCM Ventures China Turbo Fund, L.P., or Turbo Fund, and (iii) 589,278 Class A ordinary shares held by DCM Ventures China Turbo Affiliates Fund, L.P., or Turbo Affiliates Fund, as reported in a Schedule 13D amendment jointly filed by, among others, Hybrid Fund, Turbo Fund and Turbo Affiliates Fund, on May 7, 2025.
Awards may not be transferred in any manner by the recipient other than by will or the laws of descent and distribution, or pursuant to the other exceptions provided under the 2016 Plan, except as otherwise provided by the plan administrator. Termination .
Awards may not be transferred in any manner by the recipient other than by will or the laws of descent and distribution, or pursuant to the other exceptions provided under the Amended and Restated 2016 Plan, except as otherwise provided by the plan administrator. 82 Table of Contents Termination .
Options, restricted shares or restricted share units granted under the 2016 Plan are evidenced by an award agreement that sets forth the terms, conditions and limitations for each grant. Eligibility . We may grant awards to our employees, directors, consultants, or other individuals as determined, authorized and approved by the plan administrator. Acceleration of Awards upon Corporate Transactions .
Options, restricted shares or restricted share units granted under the Amended and Restated 2016 Plan are evidenced by an award agreement that sets forth the terms, conditions and limitations for each grant. Eligibility . We may grant awards to our employees, directors, consultants, or other individuals as determined, authorized and approved by the plan administrator.
Share Ownership Except as specifically noted, the following table sets forth information with respect to the beneficial ownership of our ordinary shares as of February 28, 2025: ● each of our directors and executive officers; and ● each person known to us to own beneficially 5% or more of our ordinary shares.
Share Ownership Except as specifically noted, the following table sets forth information with respect to the beneficial ownership of our ordinary shares as of March 18, 2026: ● each of our directors and executive officers; and ● each person known to us to own beneficially 5% or more of our ordinary shares.
We believe that we maintain a good working relationship with our employees, and we have not experienced any significant labor disputes. E.
We believe that we maintain a good working relationship with our employees, and we have not experienced any significant labor disputes. 85 Table of Contents E.
As of February 28, 2025, to our knowledge, 57,681,212 Class B ordinary shares are held by DCM Hybrid RMB Fund, L.P., or Hybrid Fund, which is registered in the Cayman Islands.
As of March 18, 2026, to our knowledge, 57,681,212 Class B ordinary shares are held by DCM Hybrid RMB Fund, L.P., or Hybrid Fund, which is registered in the Cayman Islands.
We had a total of 171, 310 and 539 full - time employees as of December 31, 2022, 2023 and 2024, respectively.
We had a total of 310, 539 and 729 full - time employees as of December 31, 2023, 2024 and 2025, respectively.
An executive officer may terminate his or her employment at any time by giving a three-month prior written notice. ​ 96 Table of Contents Each executive officer has agreed to hold, at all times during and after the termination or expiry of his or her employment agreement, in strict confidence and not to use, except as required in the performance of his or her duties in connection with the employment or pursuant to applicable law, any of our confidential information, or the confidential or proprietary information disclosed to the executive officer by or obtained by the executive officer from us either directly or indirectly in writing, orally or otherwise, if specifically indicated to be confidential or reasonably expected to be confidential.
Each executive officer has agreed to hold, at all times during and after the termination or expiry of his or her employment agreement, in strict confidence and not to use, except as required in the performance of his or her duties in connection with the employment or pursuant to applicable law, any of our confidential information, or the confidential or proprietary information disclosed to the executive officer by or obtained by the executive officer from us either directly or indirectly in writing, orally or otherwise, if specifically indicated to be confidential or reasonably expected to be confidential.
Directors and Executive Officers Age Position/Title Jack Jiajia Huang ​ 40 ​ Founder, Chairman, Chief Executive Officer Ting Shu ​ 39 ​ Co-Founder, Director Cindy Chun Tang ​ 49 ​ Chief Financial Officer Frank Lin ​ 60 ​ Director Jimmy Lai ​ 69 ​ Independent Director Xiaoguang Wu ​ 49 ​ Independent Director ​ Mr.
Directors and Executive Officers ​ ​ ​ Age ​ ​ ​ Position/Title Jack Jiajia Huang ​ 41 ​ Founder, Chairman, Chief Executive Officer Ting Shu ​ 40 ​ Co-Founder, Director Cindy Chun Tang ​ 50 ​ Chief Financial Officer Frank Lin ​ 61 ​ Director Jimmy Lai ​ 70 ​ Independent Director Xiaoguang Wu ​ 50 ​ Independent Director ​ Mr.
Other than the above-mentioned statutory contributions mandated by applicable laws, rules and regulations in the countries and regions where we operate, we have not set aside or accrued any amount to provide pension, retirement or other similar benefits to our executive officers and directors.
Other than the above-mentioned statutory contributions mandated by applicable laws, rules and regulations in the countries and regions where we operate, we have not set aside or accrued any amount to provide pension, retirement or other similar benefits to our executive officers and directors. 79 Table of Contents Employment Agreements and Indemnification Agreements We have entered into employment agreements with each of our executive officers.
It was previously considered that a director need not exhibit in the performance of his or her duties a greater degree of skill than may reasonably be expected from a person of his or her knowledge and experience.
Our directors also have a duty to act with skill and care. It was previously considered that a director need not exhibit in the performance of his or her duties a greater degree of skill than may reasonably be expected from a person of his or her knowledge and experience.
The general partner of each of Turbo Fund and Turbo Affiliates Fund is DCM Turbo Fund Investment Management, L.P., or Turbo Fund DGP, whose general partner in turn, is DCM Turbo Fund International, Ltd., or Turbo Fund UGP. Hurst Lin and Matthew C.
The general partner of each of Turbo Fund and Turbo Affiliates Fund is DCM Turbo Fund Investment Management, L.P., or Turbo Fund DGP, whose general partner in turn, is DCM Turbo Fund International, Ltd., or Turbo Fund UGP. F. Hurst Lin (also known as Frank Hurst Lin), Matthew C. Bonner and Andre G.
The nominating and corporate governance committee is responsible for, among other things: ● recommending nominees to the board for election or re-election to the board, or for appointment to fill any vacancy on the board; ● reviewing annually with the board the current composition of the board with regards to characteristics such as independence, knowledge, skills, experience, expertise, diversity and availability of service to us; ​ 101 Table of Contents ● selecting and recommending to the board the names of directors to serve as members of the audit committee and the compensation committee, as well as of the nominating and corporate governance committee itself; ● developing and reviewing the corporate governance principles adopted by the board and advising the board with respect to significant developments in the law and practice of corporate governance and our compliance with such laws and practices; and ● evaluating the performance and effectiveness of the board as a whole.
The nominating and corporate governance committee is responsible for, among other things: ● recommending nominees to the board for election or re-election to the board, or for appointment to fill any vacancy on the board; ● reviewing annually with the board the current composition of the board with regards to characteristics such as independence, knowledge, skills, experience, expertise, diversity and availability of service to us; ● selecting and recommending to the board the names of directors to serve as members of the audit committee and the compensation committee, as well as of the nominating and corporate governance committee itself; ● developing and reviewing the corporate governance principles adopted by the board and advising the board with respect to significant developments in the law and practice of corporate governance and our compliance with such laws and practices; and ● evaluating the performance and effectiveness of the board as a whole. 84 Table of Contents Duties of Directors Under Cayman Islands law, our directors have a duty of loyalty to act honestly in good faith with a view to our best interests, and not to use their position for personal gains.
As of February 28, 2025, options to purchase an aggregate number of 8,771,195 Class A ordinary shares have been granted and are outstanding, and nil restricted share units have been granted and are outstanding. The terms of the Pre-IPO Plans are substantially similar. The following paragraphs summarize the terms of the Pre-IPO Plans. Types of Awards .
As of March 18, 2026, options to purchase an aggregate number of 5,946,640 Class A ordinary shares have been granted and are outstanding, and nil restricted share units have been granted and are outstanding. The terms of the Pre-IPO Plans are substantially similar. The following paragraphs summarize the terms of the Pre-IPO Plans. Types of Awards .
Huang. ​ 104 Table of Contents (2) Represents (i) 186,180 Class A ordinary shares in the form of ADSs held by Jack Jiajia Huang, (ii) 39,639,075 Class A ordinary shares in the form of ADSs held by Dasheng Global Limited, (iii) 275,000 Class A ordinary shares issuable to Dasheng Global Limited upon the vesting of restricted share units within 60 days after February 28, 2025, (iv) 277,200 Class A ordinary shares in the form of ADSs held by Ting Shu, (v) 67,380 Class A ordinary shares issuable to Ting Shu upon the vesting of restricted share units within 60 days after February 28, 2025, (vi) 30,390,321 Class B ordinary shares held by Dasheng Global Limited, and (vii) 15,535,423 Class B ordinary shares held by Dasheng Online Limited.
(2) Represents (i) 186,180 Class A ordinary shares in the form of ADSs held by Jack Jiajia Huang, (ii) 41,563,800 Class A ordinary shares in the form of ADSs held by Dasheng Global Limited, (iii) 275,000 Class A ordinary shares issuable to Dasheng Global Limited upon the vesting of restricted share units within 60 days after March 18, 2026, (iv) 432,900 Class A ordinary shares in the form of ADSs held by Ting Shu, (v) 30,390,321 Class B ordinary shares held by Dasheng Global Limited, and (vi) 15,535,423 Class B ordinary shares held by Dasheng Online Limited.
We may also terminate an executive officer’s employment by giving a three-month prior written notice.
We may also terminate an executive officer’s employment by giving a three-month prior written notice. An executive officer may terminate his or her employment at any time by giving a three-month prior written notice.
On January 1, 2025, the maximum aggregate number of shares which may be issued pursuant to all awards under the 2016 Plan was increased to 48,259,734 Class A ordinary shares.
On January 1, 2026, the maximum aggregate number of shares which may be issued pursuant to all awards under the Amended and Restated 2016 Plan was increased to 53,645,627 Class A ordinary shares.
Unless terminated earlier, the 2016 Plan will terminate automatically in 2026. ​ 99 Table of Contents The following table summarizes, as of February 28, 2025, the outstanding restricted share units granted to our directors and executive officers under the 2016 Plan. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Name Restricted Share Units Date of Grant Vesting Schedule Jack Jiajia Huang ​ * ​ ​ June 30, 2023 Approximately three years from the date of grant.
The following table summarizes, as of March 18, 2026, the outstanding restricted share units granted to our directors and executive officers under the Amended and Restated 2016 Plan. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Name ​ ​ ​ Restricted Share Units ​ ​ ​ Date of Grant ​ ​ ​ Vesting Schedule Jack Jiajia Huang ​ 550,000 ​ ​ June 30, 2023 Approximately three years from the date of grant. ​ ​ ​ 1,100,000 ​ ​ February 18, 2025 ​ Approximately three years from the date of grant.
Ting Shu ​ * ​ ​ June 30, 2023 Approximately two years from the date of grant. Jimmy Lai ​ * ​ ​ June 1, 2024 Approximately two years from the date of grant. Xiaoguang Wu ​ ​ * ​ ​ July 1, 2024 ​ Approximately two years from the date of grant.
Jimmy Lai ​ 50,336 ​ ​ June 1, 2024 Approximately two years from the date of grant. Xiaoguang Wu ​ ​ 91,818 ​ ​ July 1, 2024 ​ Approximately two years from the date of grant.
As of December 31, 2024, we had approximately 28 employees in research and development, 289 employees in sales and marketing, 140 employees in management and administration, 71 employees in free trial tutors and teaching support and 11 employees in learning partner.
As of December 31, 2025, we had approximately 42 employees in research and development, 345 employees in sales and marketing, 258 employees in management and administration, 36 employees in free trial tutors and teaching support and 48 employees in learning partner.
The calculations in the table below are based on 351,568,497 ordinary shares outstanding as of February 28, 2025, comprising of 247,961,517 Class A ordinary shares (excluding 3,780,375 Class A ordinary shares issued to our depositary bank for bulk issuance of ADSs reserved for future issuances upon the exercising or vesting of awards granted under the issuer’s share incentive plan) and 103,606,980 Class B ordinary shares.
The calculations in the table below are based on 360,438,897 ordinary shares outstanding as of March 18, 2026, comprising of 256,831,917 Class A ordinary shares (excluding 6,909,975 Class A ordinary shares issued to our depositary bank for bulk issuance of ADSs reserved for future issuances upon the exercising or vesting of awards granted under the issuer’s share incentive plan) and 103,606,980 Class B ordinary shares.
As of February 28, 2025, options to purchase an aggregate number of 49,980 Class A ordinary shares have been granted and are outstanding, and 9,359,363 restricted share units have been granted and are outstanding. The following paragraphs summarize the terms of the 2016 Plan. Types of Awards .
As of March 18, 2026, options to purchase an aggregate number of 37,500 Class A ordinary shares have been granted and are outstanding and 13,009,194 restricted share units have been granted and are outstanding. The following paragraphs summarize the terms of the Amended and Restated 2016 Plan. Types of Awards .
SCC Venture V Holdco I, Ltd. is wholly owned by Sequoia Capital China Venture Fund V, L.P., whose general partner is SC China Venture V Management, L.P., whose general partner in turn, is SC China Holding Limited. SCC Growth I Holdco A, Ltd. is wholly owned by Sequoia Capital China Growth Fund I, L.P.
HSG Venture V Holdco I, Ltd. is wholly owned by HongShan Capital Venture Fund V, L.P., whose general partner is HSG Venture V Management, L.P., whose general partner in turn, is HSG Holding Ltd. HSG Holding Ltd is wholly owned by Neil Nanpeng Shen.
For our full-time employees in mainland China, we also enter into stand-alone confidentiality and non-compete agreements with them.
For our full-time employees in mainland China, we also enter into stand-alone confidentiality and non-compete agreements with them. In addition to salaries and benefits, we provide performance-based bonuses for our full-time employees and commission-based compensation for our sales and marketing force.
To our knowledge, we are not owned or controlled, directly or indirectly, by another corporation, by any government or by any other natural or legal persons, severally or jointly.
To our knowledge, we are not owned or controlled, directly or indirectly, by another corporation, by any government or by any other natural or legal persons, severally or jointly. We are not aware of any arrangement that may, at a subsequent date, result in a change of control of our company.
These shares, however, are not included in the computation of the percentage ownership of any other person. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ordinary Shares Beneficially Owned ​ ​ ​ ​ ​ % of total ​ ​ ​ Class A Class B Total ordinary ordinary shares on % of ​ ​ ordinary ordinary shares on an as- an as converted aggregate ​ ​ ​ Shares ​ Shares ​ converted basis basis ​ voting power † ​ Directors and Executive Officers: ​ ​ ​ ​ ​ ​ Jack Jiajia Huang (1) 61,441,740 ​ 45,925,744 ​ 107,367,484 ​ 30.5 % 40.5 % Ting Shu (2) 40,764,900 ​ 45,925,744 ​ 86,690,644 ​ 24.6 % 38.9 % Cindy Chun Tang * ​ — ​ * ​ * ​ * ​ Frank Lin (3) * ​ — ​ * ​ * ​ * ​ Jimmy Lai * ​ — ​ * ​ * ​ * ​ Xiaoguang Wu (4) * ​ — ​ * ​ * ​ * ​ All directors and executive officers as a group 67,470,480 ​ 45,925,744 ​ 113,396,224 ​ 32.2 % 41.0 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Principal Shareholders: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ DCM Funds (5) 10,607,110 ​ 57,681,212 ​ 68,288,322 ​ 19.4 % 45.7 % Dasheng International Holdings Limited (2) 40,764,900 ​ 45,925,744 ​ 86,690,644 ​ 24.6 % 38.9 % Sequoia Capital China Investment Funds (6) 40,033,395 ​ — ​ 40,033,395 ​ 11.4 % 3.1 % Golien Ltd (7) 18,967,560 ​ — ​ 18,967,560 ​ 5.4 % 1.5 % 103 Table of Contents Notes: * Less than 1% of total ordinary shares on an as-converted basis. † For each person and group included in this column, percentage of voting power is calculated by dividing the voting power beneficially owned by such person or group by the voting power of all of our Class A and Class B ordinary shares as a single class.
These shares, however, are not included in the computation of the percentage ownership of any other person. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ordinary Shares Beneficially Owned ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ % of total ​ ​ ​ ​ ​ ​ Class A Class B Total ordinary ordinary shares on % of ​ ​ ordinary ordinary shares on an as- an as converted aggregate ​ ​ ​ Shares ​ Shares ​ converted basis basis ​ voting power † ​ Directors and Executive Officers: ​ ​ ​ ​ ​ ​ Jack Jiajia Huang (1) 72,960,560 ​ 45,925,744 ​ 118,886,304 ​ 33.0 % 41.2 % Ting Shu (2) 42,457,880 ​ 45,925,744 ​ 88,383,624 ​ 24.5 % 38.8 % Cindy Chun Tang 1,103,820 ​ — ​ 1,103,820 ​ 0.3 % 0.1 % Frank Lin (3) 1,119,495 ​ — ​ 1,119,495 ​ 0.3 % 0.1 % Jimmy Lai 2,931,900 ​ — ​ 2,931,900 ​ 0.8 % 0.2 % Xiaoguang Wu (4) 1,358,287 ​ — ​ 1,358,287 ​ 0.4 % 0.1 % All directors and executive officers as a group 79,474,062 ​ 45,925,744 ​ 125,399,806 ​ 34.8 % 41.7 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Principal Shareholders: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ DCM Funds (5) 10,607,110 ​ 57,681,212 ​ 68,288,322 ​ 18.9 % 45.4 % Dasheng International Holdings Limited (2) 42,457,880 ​ 45,925,744 ​ 88,383,624 ​ 24.5 % 38.8 % HongShan Investment Fund (6) 28,494,075 ​ — ​ 28,494,075 ​ 7.9 % 2.2 % HH Talent Holdings Limited (7) ​ 23,391,300 ​ — ​ 23,391,300 ​ 6.5 % 1.8 % Golien Ltd (8) 18,967,560 ​ — ​ 18,967,560 ​ 5.3 % 1.5 % Notes: † For each person and group included in this column, percentage of voting power is calculated by dividing the voting power beneficially owned by such person or group by the voting power of all of our Class A and Class B ordinary shares as a single class.
(1) Consists of Represents (i) 7,297,560 Class A ordinary shares in the form of ADSs held by Jack Jiajia Huang, (ii) 39,639,075 Class A ordinary shares in the form of ADSs held by Dasheng Global Limited, a company incorporated in the British Virgin Islands, (iii) 275,000 Class A ordinary shares issuable to Dasheng Global Limited upon the vesting of restricted share units within 60 days after February 28, 2025, (iv) 4,652,580 Class A ordinary shares in the form of ADSs purchased by HH Talent Limited, a company incorporated in the British Virgin Islands, (v) 277,200 Class A ordinary shares in the form of ADSs held by Ting Shu, (vi) 67,380 Class A ordinary shares issuable to Ting Shu upon the vesting of restricted share units within 60 days after February 28, 2025, (vii) 30,390,321 Class B ordinary shares held by Dasheng Global Limited, and (viii) 15,535,423 Class B ordinary shares held by Dasheng Online Limited, a company incorporated in the British Virgin Islands.
Our Class B ordinary shares are convertible at any time by the holder thereof into Class A ordinary shares on a one-for-one basis. 86 Table of Contents (1) Represents (i) 7,297,560 Class A ordinary shares in the form of ADSs held by Jack Jiajia Huang, (ii) 41,563,800 Class A ordinary shares in the form of ADSs held by Dasheng Global Limited, a company incorporated in the British Virgin Islands, (iii) 275,000 Class A ordinary shares issuable to Dasheng Global Limited upon the vesting of restricted share units within 60 days after March 18, 2026, (iv) 23,391,300 Class A ordinary shares in the form of ADSs purchased by HH Talent Limited, a company incorporated in the British Virgin Islands, (v) 432,900 Class A ordinary shares in the form of ADSs held by Ting Shu, (vi) 30,390,321 Class B ordinary shares held by Dasheng Global Limited, and (vii) 15,535,423 Class B ordinary shares held by Dasheng Online Limited, a company incorporated in the British Virgin Islands.
As of February 28, 2025, other current and former employees as a group held options to purchase 8,771,195 Class A ordinary shares under the 2014 Plan, with exercise prices ranging from US$0.0167 to US$0.904 per Class A ordinary share. ​ 98 Table of Contents 2016 Plan We adopted the 2016 share incentive plan, or the 2016 Plan, in May 2016.
As of March 18, 2026, other current and former employees as a group held options to purchase 5,946,640 Class A ordinary shares under the 2014 Plan, with exercise prices ranging from US$0.0167 to US$0.904 per Class A ordinary share.
(6) Consists of (i) 28,494,075 Class A ordinary shares held by SCC Venture V Holdco I, Ltd., an exempted company with limited liability incorporated under the laws of the Cayman Islands; and (ii) 11,539,320 Class A ordinary shares held by SCC Growth I Holdco A, Ltd., an exempted company with limited liability incorporated under the laws of the Cayman Islands, as reported in a Schedule 13D amendment jointly filed by, among others, SCC Venture V Holdco I, Ltd. and SCC Growth I Holdco A, Ltd, on May 9, 2022.
(formerly known as SCC Venture V Holdco I, Ltd.), an exempted company with limited liability incorporated under the laws of the Cayman Islands, as reported in a Schedule 13D amendment jointly filed by, among others, HSG Venture V Holdco I, Ltd. on December 5, 2025.
Board Practices Board of Directors Our board of directors consists of five directors. A director is not required to hold any shares in our company to qualify to serve as a director. A director may vote with respect to any contract, proposed contract, or arrangement in which he or she is materially interested.
A director may vote with respect to any contract, proposed contract, or arrangement in which he or she is materially interested.
We enter into service contracts with such independently contracted tutors, and pay service fees to them based on the number of lessons they teach and their teaching performance. We had approximately 7.0 thousand independently contracted foreign tutors available to deliver lessons for our international business on our platform as of December 31, 2024.
Independently contracted foreign tutors and Chinese tutors delivering paid lessons on our platform are generally not our full - time employees. We enter into service contracts with such independently contracted tutors, and pay service fees to them based on the number of lessons they teach and their teaching performance.
No award may be granted during any suspension of the Pre-IPO Plans or after termination of the Pre-IPO Plans. No suspension or termination of the Pre-IPO Plans (including termination of the Pre-IPO Plans after it has served its term) shall adversely affect any rights under awards already granted to a grantee.
No suspension or termination of the Pre-IPO Plans (including termination of the Pre-IPO Plans after it has served its term) shall adversely affect any rights under awards already granted to a grantee. 81 Table of Contents There were no outstanding options granted to our directors and executive officers under the 2013 Plan and 2014 Plan as of March 18, 2026.
As of February 28, 2025, other current as a group held options to purchase 49,980 Class A ordinary shares under the 2016 Plan, with exercise prices US$0.2610 per Class A ordinary share. As of February 28, 2025, other current employees as a group held 6,863,303 restricted share units under the 2016 Plan. C.
Total ​ 1,792,154 ​ ​ ​ ​ As of March 18, 2026, other current employees as a group held options to purchase 37,500 Class A ordinary shares under the Amended and Restated 2016 Plan, with exercise prices US$0.2610 per Class A ordinary share.
We are not aware of any arrangement that may, at a subsequent date, result in a change of control of our company. ​ 105 Table of Contents To our knowledge, as of February 28, 2025, 236,042,100 of our Class A ordinary shares are held by one record holder in the United States, which is the depositary of our ADS program, representing 95.2% of our total issued and outstanding Class A ordinary shares as of such date.
To our knowledge, as of March 18, 2026, 245,982,360 of our Class A ordinary shares are held by one record holder in the United States, which is the depositary of our ADS program, representing 95.8% of our total issued and outstanding Class A ordinary shares as of such date.
The registered address of SCC Growth I Holdco A, Ltd. and SCC Venture V Holdco I, Ltd. is Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands. Neither SCC Venture V Holdco I, Ltd. nor SCC Growth I Holdco A, Ltd. has any board seat of 51Talk to the date of this annual report.
The registered address of HSG Venture V Holdco I, Ltd. is Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands. 87 Table of Contents (7) Consists of 23,391,300 Class A ordinary shares in the form of ADSs held by HH Talent Limited.
Beginning in 2017, the number of shares reserved for future issuances under the 2016 Plan will be increased by a number equaling to 1.5% of the total number of outstanding shares on the last day of the immediately preceding calendar year, or such lesser number of Class A ordinary shares as determined by our board of directors, during the term of the 2016 Plan.
Under the Amended and Restated 2016 Plan, the maximum aggregate number of shares which may be issued pursuant to all awards under the Amended and Restated 2016 Plan is initially 4,600,000 Class A ordinary shares in 2016, plus (i) an annual increase, on the first day of each fiscal year from 2017 through 2026, equal to 1.5% of the total outstanding share capital of the Company as of December 31 of the immediately preceding calendar year, and (ii) an annual increase, on the first day of each fiscal year beginning in 2027, equal to 1.2% of the total outstanding share capital of the Company as of December 31 of the immediately preceding calendar year, or, in each case, such lesser number of Class A ordinary shares as may be determined by our board of directors.
Removed
Employment Agreements and Indemnification Agreements We have entered into employment agreements with each of our executive officers.
Added
No award may be granted during any suspension of the Pre-IPO Plans or after termination of the Pre-IPO Plans.
Removed
There were no outstanding options granted to our directors and executive officers under the 2013 Plan and 2014 Plan as of February 28, 2025.
Added
Amended and Restated 2016 Plan We adopted the original 2016 share incentive plan, or the 2016 Plan, in May 2016, which was amended and restated in April 2026.
Removed
The maximum aggregate number of shares which may be issued pursuant to all awards under the 2016 Plan is initially 4,600,000 Class A ordinary shares.
Added
Upon the adoption of the Amended and Restated 2016 share incentive plan, or the Amended and Restated 2016 Plan, it replaced the previously adopted 2016 Plan in its entirety and the awards granted and outstanding thereunder remain effective and binding under the amended and restated 2016 Plan.
Removed
Cindy Chun Tang ​ ​ * ​ ​ March 30, 2024 ​ Approximately two years from the date of grant. Total ​ 2,496,060 ​ ​ ​ * The aggregate number of ordinary shares that will be vested from restricted share units is less than 1% of our total issued and outstanding ordinary shares.
Added
Unless terminated earlier, the Amended and Restated 2016 Plan will terminate automatically in 2030.
Removed
Duties of Directors Under Cayman Islands law, our directors have a duty of loyalty to act honestly in good faith with a view to our best interests, and not to use their position for personal gains. Our directors also have a duty to act with skill and care.
Added
As of March 18, 2026, other current employees as a group held 11,217,040 restricted share units under the Amended and Restated 2016 Plan. C. Board Practices Board of Directors Our board of directors consists of five directors. A director is not required to hold any shares in our company to qualify to serve as a director.
Removed
In addition to salaries and benefits, we provide performance-based bonuses for our full-time employees and commission-based compensation for our sales and marketing force. ​ 102 Table of Contents Independently contracted foreign tutors and Chinese tutors delivering paid lessons on our platform are generally not our full - time employees.
Added
We had approximately 9.8 thousand independently contracted foreign tutors available to deliver lessons for our international business on our platform as of December 31, 2025.
Removed
Our Class B ordinary shares are convertible at any time by the holder thereof into Class A ordinary shares on a one-for-one basis.
Added
(6) Consists of 28,494,075 Class A ordinary shares held by HSG Venture V Holdco I, Ltd.
Removed
The general partner of Sequoia Capital China Growth Fund I, L.P. is Sequoia Capital China Growth Fund Management I, L.P., whose general partner is SC China Holding Limited. SC China Holding Limited is wholly owned by SNP China Enterprises Limited, which in turn is wholly owned by Neil Nanpeng Shen.
Added
The registered office address of HH Talent Limited is Coastal Building, Wickham’s Cay II, P.O. Box 2221, Road Town, Tortola, British Virgin Islands. HH Talent Limited is wholly beneficially owned by HH Talent Holdings Limited, which is in turn wholly owned by HH Talent Trust, for which the Trustee also acts as the trustee. S.B.
Added
Vanwall Ltd., appointed by the Trustee, is the sole director of Dasheng International Holdings Limited and HH Talent Holdings Limited. The settlors of TB Family Trust are Mr. Huang and Ms. Shu. Mr. Huang, Ms. Shu and their family members are beneficiaries under TB Family Trust. The settlor of HH Talent Trust is Mr. Huang.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

6 edited+0 added−0 removed1 unchanged
Under the cooperation, 51Talk English International Limited provides agent services to Dasheng Holding (HK) Limited, its subsidiaries and the consolidated VIEs. In 2023 and 2024, our company also entered into a series of service agreements, with Dasheng Holding (HK) Limited and its subsidiaries.
Under the cooperation, 51Talk English International Limited provides agent services to Dasheng Holding (HK) Limited, its subsidiaries and the consolidated VIEs. In 2023, 2024 and 2025, our company also entered into a series of service agreements, with Dasheng Holding (HK) Limited, its subsidiaries and its VIEs.
Under these service agreements, Dasheng Holding (HK) Limited and its subsidiaries provide technology service and product development labor service to our company.
Under these service agreements, Dasheng Holding (HK) Limited, its subsidiaries and its VIEs provide technology service and product development labor service to our company.
For the year ended December 31, 2024, the fair value of agent service provided by our company is estimated to be US$0.1 million, which are recognized as net revenues in the consolidated statement of comprehensive income/ (loss) of our company.
For the year ended December 31, 2025, the fair value of agent service provided by our company is estimated to be US$0.1 million, which are recognized as net revenues in the consolidated statement of comprehensive loss of our company.
Directors, Senior Management and Employees—B. Compensation—Employment Agreements and Indemnification Agreements.” ​ 106 Table of Contents Share Option Grants See “Item 6. Directors, Senior Management and Employees—B. Compensation—Share Incentive Plan.” C. Interests of Experts and Counsel Not applicable. ​
Employment Agreements and Indemnification Agreements See “Item 6. Directors, Senior Management and Employees—B. Compensation—Employment Agreements and Indemnification Agreements.” Share Option Grants See “Item 6. Directors, Senior Management and Employees—B. Compensation—Share Incentive Plan.” C. Interests of Experts and Counsel Not applicable. ​
For a description of these contractual arrangements, see “Item 4. Information on the Company—C. Organizational Structure.” Transactions with Shareholders and Affiliates Transactions with Dasheng Holding (HK) Limited, its subsidiaries and the consolidated VIEs. In 2022, Dasheng Holding (HK) Limited and its subsidiaries entered into an offshore service agreement with 51Talk English International Limited.
For a description of these contractual arrangements, see “Item 4. Information on the Company—C. Organizational Structure.” 88 Table of Contents Transactions with Shareholders and Affiliates Transactions with Dasheng Holding (HK) Limited and its subsidiaries. In 2022, Dasheng Holding (HK) Limited and its subsidiaries entered into an offshore service agreement with 51Talk English International Limited.
For the year ended December 31, 2024, the amount of product development labor service received from Dasheng Holding (HK) Limited and its subsidiaries is estimated to be US$0.6 million, and the amount of internet service received from Dasheng Holding (HK) Limited and its subsidiaries is estimated to be US$0.3 million. Employment Agreements and Indemnification Agreements See “Item 6.
For the year ended December 31, 2025, the amount of product development labor service received from Dasheng Holding (HK) Limited, its subsidiaries and its VIEs is estimated to be US$2.1 million, and the amount of internet service received from Dasheng Holding (HK) Limited, its subsidiaries and its VIEs is estimated to be US$0.6 million.

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